* Deal affects two adjacent fields in the Rovuma Basin
* Cos say ops in the two fields will eventually be combined
* Will jointly construct onshore gas liquefaction facilities
* Some 150 tcf of gas already found off Mozambique coast
* Exxon, Shell, others have yet to gain a foothold there
By Francesca Landini
MILAN, Dec 21 Oil and gas companies Eni
and Anadarko plan to unite their neighbouring gas fields
off Mozambique's coast, boosting the development prospects of
one of the world's most significant new energy projects.
The two companies said on Friday that while their offshore
activities would remain separate at first, they would be
conducted in a co-ordinated way and the two adjacent fields they
operate in the Rovuma Basin would eventually be combined.
Meanwhile, the partners will jointly plan and construct
common onshore gas liquefaction facilities in the Cabo Delgado
province of northern Mozambique.
Four of the five largest oil and gas discoveries in the
world this year have been made off Mozambique. Potentially the
biggest and most profitable of them all sits across the border
between the blocks operated by state-backed Italian group Eni
and U.S. independent Anadarko.
Some 150 trillion cubic feet (tcf) of gas have been found
off the east African country's shores so far, enough to supply
Germany, Britain, France and Italy for 15 years, and the
government and companies scouting wells have estimated there may
be potential to double that estimate.
Even the first stage of proposed Liquefied Natural Gas (LNG)
facilities that allow the gas to be transported by special ship
to energy-hungry Asian markets could satisfy 10 percent of
demand in Japan, one of the region's biggest LNG markets.
"We expect the HOA (heads of agreement) to lead to a
unitisation agreement to further facilitate the efficient
development of the common resources," said Anadarko President
and CEO Al Walker.
He said the two groups would work alongside the Mozambican
government toward a shared target of exporting first LNG cargoes
A source familiar with the deal said it increased the
likelihood that the 2018 deadline would be met.
"It's an important step because it shows they've got round a
table fast to agree to work together (on unitisation)," the
source said. "The importance is that without an agreement
project times could have been thrown back."
Takeover talk has swirled around Anadarko through the past
year, in large part because of its Mozambique position, with one
banker describing the company as "the oil industry hottest M&A
prospect in years".
A source close to Royal Dutch Shell has said the
Netherlands-based world No. 2 has held talks about buying into
Anadarko's block and is also interested in Eni's. Traders have
also speculated Shell might bid for Anadarko.
Shell tried and failed earlier this year to buy a company
that holds a stake in the Anadarko block. Thai group PTT
eventually won the contest for Cove Energy with a $1.9
billion bid after Shell backed away from a bidding contest.
Other big players including BP, ExxonMobil
and Chevron are also seen as likely to seek an interest
in the fields. Shell and Chevron in particular are betting
heavily on LNG as a future source of income, and do not want to
find the costly Australian projects into which they are sinking
tens of billions of dollars priced out of the market.
Friday's deal also represents a boost for Mozambique, which
aims to use the gas finds as a starting point to develop
domestic industries as the LNG exports lift government revenue
by between $6 billion and $8 billion a year.
Anadarko is the operator of Mozambique's offshore Area 1
with a 36.5 percent interest. Japanese group Mitsui & Co
owns 20 percent, India's Bharat Petroleum Corp
10 percent, Videocon Industries Ltd 10
percent, PTT 8.5 percent and Mozambique's state-owned ENH 15
Eni operates Area 4 with a 70 percent interest. Portugal's
Galp Energia, South Korea's KOGAS and ENH hold 10
Anadarko's stock climbed 2.5 percent on Thursday, making it
the biggest gainer among top international oil stocks, although
it is a consistently volatile stock and in out-of-hours trading
on Friday it had given up much of that gain.
Eni shares were little changed.