Mozambique: Sale of natural gas assets to Total concluded – AIM report

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Mozambique: Sale of natural gas assets to Total concluded – AIM report

10:05 CAT | 29 Sep 2019

Photo: Presidente Filipe Nyusi@NyusiConfioemti / Facebook

Mozambican President Filipe Nyusi announced on Friday, in the central city of Chimoio, the conclusion of the deal under which shares in offshore Area One of the Rovuma Basin have been sold by the Texas-based company Anadarko, to a second US oil and gas company, Occidental Petroleum.

Occidental has in turn sold all of Anadarko’s African assets, of which Rovuma Basin Area One is by far the most significant, to the French company Total.

Nyusi granted an audience in Chimoio to the chairpersons of Occidental and Total, respectively Vicki Hollub and Patrick Pouyanne.

Occidental acquired all of Anadarko in a takeover concluded on 8August. Anadarko and the company it set up to run the Liquefied Natural Gas (LNG) project in the Cabo Delgado district of Palma, Anadarko Mocambique Area One (AMA1), both continued to exist, but as wholly owned subsidiaries of Occidental.

At much the same time Occidental signed a definitive contract with Total, under which Total was to purchase all the Anadarko assets in Africa, including AMA1.

The sale to Occidental, valued at 55 billion US dollars, was approved by 99 per cent of the Anadarko shareholders.
Total agreed to pay Occidental 8.8 billion dollars for the Anadarko African assets.

Vicki Hollub told reporters in Chimoio that the transaction will result in the payment to the Mozambican government of capital gains tax of around 880 million dollars. This sum should become available in the accounts of the Mozambican treasury later this year.

Pouyane — *Vicki Hollub and Patrick Pouyanne, speak to the press in Chimoio. [Photo: TVM]*

The LNG project involves building two LNG factories (known as “trains”) in the Afungi peninsula in Palma district. The total investment is estimated to be at least 23 billion dollars. About 5,000 Mozambicans, 40 per cent of them from Palma, are currently working on the project. Total has guaranteed that they will all keep their jobs, and that there will be no disruption in the building of the LNG plants.

Anadarko should hand over the leadership of the Area One consortium to Total by the end of this year.

The other partners in the consortium are the Japanese company Mitsui (20 per cent), PTTEP of Thailand (8.5 per cent), the three Indian companies ONGC Videsh, Bias Rovuma Energy, and BRPL Ventures (each with ten per cent), and Mozambique’s own National Hydrocarbon Company (ENH – 15 per cent).

The confirmed reserves of natural gas in Area One are 76 trillion cubic feet.

Source: AIM