ExxonMobil closes Mozambique deal with Eni

ExxonMobil has completed a transaction to acquire a 25 percent indirect interest in Mozambique’s gas-rich Area 4 block from Eni and assume responsibility for midstream operations.

The transaction between the two companies worth around $2.8 billion was announced in March 2017.

ExxonMobil will lead the construction and operation of all future natural gas liquefaction and related facilities, while Eni will continue to lead the Coral floating LNG project and all upstream operations, Exxon said on Wednesday.

To remind, the final investment decision for the Coral South FLNG Project, the first development of the considerable gas resources discovered by Eni in Area 4, was reached in May 2017, just three years after the drilling of the final exploration well. Earlier in December, Eni achieved financial close for a total amount of around $4.7 billion for the Coral South FLNG multi-sourced project financing.

Exxon added that the operating model will enable the use of best practices and skills with each company focusing on distinct and clearly defined scopes while preserving the benefits of an integrated project.

“ExxonMobil brings our LNG leadership and experience to support development of Mozambique’s high-quality natural gas resources,” said Darren W. Woods, chairman and chief executive officer.

“We are confident that our project and marketing expertise, coupled with our financial strength, will help grow the value of Mozambique’s energy resources. We will work closely with our partners to develop this world-class resource.”

Natural gas is projected to be the world’s fastest-growing major fuel source, and Mozambique is well-positioned to supply LNG customers around the world. The deepwater Area 4 block contains an estimated 85 trillion cubic feet of natural gas in place.

ExxonMobil now owns a 35.7 percent interest in Eni East Africa S.p.A. (to be renamed Mozambique Rovuma Venture S.p.A.), which holds a 70 percent interest in Area 4, and is co-owned with Eni (35.7 percent) and CNPC (28.6 percent). The remaining interests in Area 4 are held by Empresa Nacional de Hidrocarbonetos E.P. (10 percent), Kogas (10 percent) and Galp Energia (10 percent).

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