Anadarko Reach Unitization Agreement With Eni in Mozambique, Sign MOU For Domestic Gas

Area 1 and Area 4 block operators Anadarko and Eni have announced that, following the signing of the Unitization and Unit Operating Agreement (UUOA) and in full agreement with all the concessionaries of the projects, a unitization was set out for the development of natural gas reservoirs straddling Areas 4 and 1 in the Rovuma Basin, offshore Mozambique.

Under the terms of the UUOA and previously announced Decree Law, the Prosperidade and Mamba straddling natural gas reservoirs, which comprise the Unit, will be developed in a separate but coordinated manner by the two operators until 24 trillion cubic feet (Tcf) of natural gas reserves (12 Tcf from each Area) have been developed.

“We appreciate the cooperation of the Government of Mozambique, Eni and our co-venturers in Offshore Area 1 for their collaborative efforts in achieving this UUOA, which is fair, equitable and consistent with best industry practices,” said Mitch Ingram, Anadarko Executive Vice President, Global LNG.

Future developments will be jointly pursued by Area 4 and Area 1 concessionaires through a joint operator, as the result of an equal joint venture between Eni East Africa and Anadarko Mozambique Area 1..

“We have already made tremendous progress advancing the natural gas resources in the Golfinho and Atum fields that are fully contained within our block, and with this UUOA, we can also expect to move the Prosperidade and Mamba straddling reservoirs forward more efficiently, while capitalizing on greater economies of scale,” adds Mitch.

The UUOA was developed in close collaboration with the 11 concessionaires, represents a fair agreement for all parties involved in the two areas and is subject to final approval by the Government of Mozambique.

In addition, Anadarko reached a Memorandum of Understanding (MOU) with the Government of Mozambique to provide natural gas from its Mozambique LNG development for domestic use.

Under the terms of the MOU, Offshore Area 1 will provide initial volumes of approximately 50 million cubic feet of natural gas per day (MMcf/d) per train (100 MMcf/d) for domestic use in Mozambique.

The natural gas will be provided at pricing that is fair to all parties and supports local natural gas development, and the concessionaires are prepared to sell up to 300 MMcf/d of additional volumes into the domestic market in future years as projects are matured and commercial terms agreed.

“We look forward to continuing to work with the Government of Mozambique to finalize the legal and contractual framework that will enable us to deliver natural gas for domestic projects and LNG cargoes for export to premium markets around the world, both of which will benefit Mozambique through a reliable source of cleaner energy and significant revenue generation.,” added Ingram.

OFFSHORE AREA 1

Anadarko is the operator of the Offshore Area 1 Block with a 26.5% working interest. Co-venturers include the National Oil Company Empresa Nacional de Hidrocarbonetos, E.P. (ENH) 15%, Mitsui E&P Mozambique Area 1 Limited 20%, Beas Rovuma Energy Mozambique Limited 10%, BPRL Ventures Mozambique B.V. 10%, ONGC Videsh Limited 10%, and PTTEP Mozambique Area 1 Limited 8.5%.

OFFSHORE AREA 4

Eni operates Area 4 with a 50% indirect interest owned through Eni East Africa (EEA), which holds 70% of Area 4. The other partners are Galp Rovuma 10%, KOGAS Mozambique 10% and ENH 10%. CNPC owns a 20-percent indirect participation in Area 4 through Eni East Africa.