Mozambique’s ambitions of becoming a major exporter of liquefied natural gas have been boosted by the announcement of another large find off its coast by a consortium led by Anadarko Petroleum of the US.
The discovery could add up to 20 trillion cubic feet (Tcf) of recoverable gas to a resource base previously estimated at more than 30tn recoverable units.
It was made at a separate geological structure to the one already appraised in the block in the Rovuma basin close to Mozambique’s border with Tanzania. The minimum recoverable resource commanded by the consortium in the block has risen from 17 Tcf to 24 Tcf.
The consortium’s Offshore Area 1 block is adjacent to another field Italian energy group Eni has explored and calculated to have a total resource of 30 Tcf
Anadarko’s junior partner on the field, Cove Energy, is continuing to negotiate its sale following a recommended £1.1bn offer from Royal Dutch Shell.
Cove last week received clearance for the sale of its 8.5 per cent interest in the block from the Mozambican government. It declined to comment directly on progress in finalising its sale.
But shares in Cove, which since the recommendation of the improved Shell bid have continued to trade above 220p in the hope of another counter-offer, rose 5p to 228.5p on Tuesday.
Rival PPT Exploration of Thailand, which announced a 220p approach to challenge Shell’s original offer of 195p a share made in February, has yet to formally withdraw its interest.
John Craven, Cove chief executive, said he was “thrilled” with the success of the latest well.
Possible buyers will have expected further upgrades in the likely reserves in the block: Anadarko, which operates the block and holds a 36.5 per cent interest, had
doubled its estimates for the field in November
.
Bob Daniels, vice-president of worldwide exploration at Anadarko, said the latest test well “significantly expands the tremendous resource potential of the offshore area 1 in the deepwater Rovuma basin, with additional opportunities yet to test”. Anadarko shares rose $1.45 to $68.20 by midday Tuesday trading.
The field’s other owners are Mitsui of Japan, with 20 per cent; Bharat Petroleum and Videocon of India, each with 10 per cent; and Mozambique state-controlled company Empresa Nacional de Hidrocarbonetos with 15 per cent.