Mozambique to unveil investment opportunities in mining and energy - MMEC 2024
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Mozambique’s Competition Regulatory Authority (ARC) has opened a public consultation on the planned sale by Portugal’s Galp Energia of its stake in the consortium prospecting for natural gas in the Rovuma Basin, to the ADNOC group, which is based in the United Arab Emirates.
In a notice published on Monday, the ARC states that it received on 27 May, with effect from 30 May, a “notification of a concentration of companies” in the form of a deal valued by Galp at €600 million.
The deal in question consists of the acquisition by ADNOC International, a subsidiary 100% owned by Abu Dhabi National Oil Company (ADNOC), of “exclusive control over Galp Energia Rovuma” – currently owned by Galp Energia, Portugal Holdings and Galp East Africa, which are “jointly the sellers” in the operation.
The note from the competition regulator notes that ADNOC International is a company incorporated in Abu Dhabi, affiliated to and 100% owned by ADNOC PJSC, “the parent company of a diversified group, 100% owned by the Emirate of Abu Dhabi” and with a presence in the energy and petrochemicals sector and which “operates throughout the hydrocarbon value chain, through a network of fully integrated companies.
“Any comments on the merger in question should be sent to the Competition Regulatory Authority within 15 days,” reads the notice of public consultation.
On 23 May, Mozambique’s National Petroleum Institute (INP) stated that it considered Galp’s withdrawal from the consortium researching natural gas in Rovuma to be normal, adding that the company had yet to formally communicate the decision to the authorities.
“It’s not something extraordinary,” said INP president Nazário Bangalane. “Concessionaires are free to negotiate directly or indirectly” about their stakes in consortia.
“In the meetings we’ve had with Galp, there has been this intention,” he added. “However, it has procedures. The Portuguese company will officially submit the process to be analysed at government level and then we will know the real amounts involved in the operation.”
Galp reached an agreement with oil company ADNOC to sell its position in the consortium researching natural gas in the Rovuma basin in Mozambique for almost €600 million.
READ: UAE’s Adnoc to buy Galp’s stake in Mozambique LNG project
Portugal: Galp sells stake in Rovuma gas consortium to ADNOC of UAE for $650M
In a statement to Portugal’s Securities Markets Commission (CMVM), Galp announced that it intended to sell its 10% stake in Area 4 in Mozambique, an operation that should be finalised by the end of the year, in line with its “disciplined” investment strategy.
“Area 4 includes Coral South FLNG, which has been operating since 2022, as well as onshore developments in the prospective Coral North FLNG and Rovuma LNG, both of which are expected to be approved in 2024/2025,” the release states.
The company is to receive $650 million (€599 million) for the shares and shareholder loans, net of capital gains taxes.
According to the release, the agreement also provides for “additional contingent payments of 100 million dollars (92 million euros) and 400 million dollars (369 million euros) with the final investment decision of Coral North and Rovuma LNG, respectively.”
Area 4 is operated by Mozambique Rovuma Venture (MRV), a joint venture between ExxonMobil of the US, Eni of Italy and CNPC of China that holds a 70% stake in the concession contract. Galp, Kogas of South Korea and Mozambique’s state-owned Empresa Nacional de Hidrocarbonetos (ENH) each have a 10% stake.
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