New development plan okayed for Mozambique gas field where Indian firms hold stake
, ET Bureau|
Mar 05, 2018, 02.11 PM IST
NEW DELHI: The government of Mozambique has approved the development plan for a natural gas field in that country where Indian state firms hold minority stake, Oil India said in a statement.
ONGC, Bharat Petroleum and Oil India together hold 30% participating interest in the Golfinho-Atum field in the Rovuma Area 1 offshore block in Mozambique for which the approval has been received. Anadarko Petroleum is the operator of the project with 26.5% participating interest while Mitsui and ENH are other concessionaires.
The Golfino Atum Project will be Mozambique’s first onshore LNG development and will supply initial volumes of about 100 million cubic feet of natural gas per day for domestic sales in Mozambique, Oil India said.
“The plan outlines the integrated development of the Golfinho-Atum field through an initial two train onshore liquefaction plant with a total processing capacity of 12.88 million metric tonnes per annum (MMTPA). This foundational project paves the way for significant future expansion of up to 50 MMTPA from Offshore Area 1,” Oil India said.
The Area 1 block is one of the largest gas discoveries in offshore East Africa with estimated recoverable resources of approximately 75 trillion cubic feet, Oil India said. The approval of the development plan is the culmination of several years of progress on technical and commercial aspects of the development, the company said.
“With the approval of major legal and contractual framework agreements, the commencement of resettlement implementation activities, site preparation, efforts to secure long term LNG Sales / offtake agreement, and progressive work towards project financing, the approval of the development plan is a significant milestone in the further progress of the Mozambique Rovuma Area-1 Offshore Project towards achieving Final Investment Decision (FID),” Oil India said.
With crude oil prices crashing in mid-2014, the FID of the project has been delayed by years and the project has missed deadlines. Natural gas prices have fallen in the past three years as most gas contracts are linked to crude oil prices. This has delayed investment in many gas projects as it was difficult to find buyers for the output at sustainable prices. With crude prices rising, the outlook has now improved.
ONGC, Bharat Petroleum and Oil India together hold 30% participating interest in the Golfinho-Atum field in the Rovuma Area 1 offshore block in Mozambique for which the approval has been received. Anadarko Petroleum is the operator of the project with 26.5% participating interest while Mitsui and ENH are other concessionaires.
The Golfino Atum Project will be Mozambique’s first onshore LNG development and will supply initial volumes of about 100 million cubic feet of natural gas per day for domestic sales in Mozambique, Oil India said.
“The plan outlines the integrated development of the Golfinho-Atum field through an initial two train onshore liquefaction plant with a total processing capacity of 12.88 million metric tonnes per annum (MMTPA). This foundational project paves the way for significant future expansion of up to 50 MMTPA from Offshore Area 1,” Oil India said.
The Area 1 block is one of the largest gas discoveries in offshore East Africa with estimated recoverable resources of approximately 75 trillion cubic feet, Oil India said. The approval of the development plan is the culmination of several years of progress on technical and commercial aspects of the development, the company said.
“With the approval of major legal and contractual framework agreements, the commencement of resettlement implementation activities, site preparation, efforts to secure long term LNG Sales / offtake agreement, and progressive work towards project financing, the approval of the development plan is a significant milestone in the further progress of the Mozambique Rovuma Area-1 Offshore Project towards achieving Final Investment Decision (FID),” Oil India said.
With crude oil prices crashing in mid-2014, the FID of the project has been delayed by years and the project has missed deadlines. Natural gas prices have fallen in the past three years as most gas contracts are linked to crude oil prices. This has delayed investment in many gas projects as it was difficult to find buyers for the output at sustainable prices. With crude prices rising, the outlook has now improved.
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