Mozambique is looking forward to some US$691 million spending on exploration after naming successful bidders in its fifth licensing round.
ExxonMobil, with partner Rosneft, has led the pack in bids to win new acreage, including deepwater areas, off the gas-rich country. The US supermajor was named as a successful bidder for three of four offshore blocks, with commitment to drill four wells across those blocks in the next four years, as well as shooting 14,000sq km of 3D seismic, following stiff competition.
Eni named as the successful bidder for the fourth block, with partners Statoil and Sasol Petroleum. Total and Sonangol could also pick up stakes in one of ExxonMobil’s successful bid blocks subject to negotiation, according to an announcement by Mozambique’s Institute of National Petroleum (INP).
Mozambique has become one of the most promising countries in Africa in terms of natural gas and coal resources. There have been prolific natural gas discoveries in Mozambique's northern offshore Rovuma basin since 2010, led by Anadarko and Eni in Areas 1 and 4, with plans for a four-train LNG plant underway.
Mozambique’s latest round will result in millions of dollars investment in exploration as well as new 2D and 3D seismic and exploration wells.
INP says: “The first period of exploration over the following four years will see these companies spend over US$691 million, drilling a minimum of 10 wells (eight in deep water), acquisition of over 3000km of 2D seismic, acquisition of over 18,400sq km of 3D seismic, 10,000 km2 of FTG (Full Tensor Gravity), high resolution magnetics programs and other geotechnical studies.”
A total of 15 areas were included in the bidding round, from within offshore Rovuma, offshore Angoche, and offshore Zambezi. Two offshore areas were also covered.
Bids had been received from potential operators for eight of the 15 areas on offer, leading to invitations to negotiate concession contracts for six of them, four being onshore.
According to INP: “Despite the current low oil price, the bids received for all the areas awarded have very significant technical work programs indicating Mozambique’s significant hydrocarbon potential.”
Winners
In a statement on its bid success, Rosneft said: “The participation in exploration and development projects in Mozambique is a new focus area of Rosneft’s international strategy: the company promotes its positioning in regions of significant hydrocarbon potential. These projects allow Rosneft to obtain access to high-quality assets, while minimizing the risks in the implementation of frontier exploration projects by partnering with global industry leaders.”
Mozambique’s fifth round was launched 23 October 2014, and closed, after six months delay, 30 July with applications received for the following offshore blocks:
According to Deloitte, exploration for hydrocarbons in Mozambique dates back to 1948 and prior to 1971, 54 exploration wells had been drilled, including 10 offshore. No discoveries were made which were deemed commercial at the time and activities ceased during the independence struggle and ensuing civil war.
Recently most interest has focused offshore, with Anadarko and Eni acquiring concessions in the Rovuma basin, off the northern coast in 2006 (offshore Areas land 4 respectively), and making their massive gas discoveries in 2010-2011.
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