Continental Focus, International Reach

Multiple LNG Supply Agreements out of Mozambique

Sunday, March 3, 2019

ONGC Videsh, the wholly owned subsidiary of ONGC, revealed that the Mozambique LNG1 Company, which is the JV marketing company of ONGC Videsh and the other partners on Mozambique’s Rovuma Offshore Area 1 development project, entered into a long-term LNG SPAs with several companies.

The deals include Tokyo Gas and Centrica LNG Company through a co-purchasing agreement for the sale of 2.6 million tons per annum (mmtpa) from the start-up of production until the early 2040s. Another agreement was signed with CNOOC Gas and Power Singapore Trading & Marketing (CNOOC) for 1.5 mmpta for a term of 13 years, and Shell International Trading Middle East for 2 mmpta for a term of 13 years.

The latest deals signed are with fellow Indian firm Bharat Gas Resources, a wholly owned subsidiary of Bharat Petroleum, for 1 mmpta for a term of 15 years and Pertamina, a state-owned oil and gas company of Indonesia, for 1 mmpta for a term of 20 years.

These latest deals build upon previously executed deals for long term offtake of LNG from the Rovuma Offshore Area 1 project and take long-term sales to more than 9.5 mmpta.

Strategically located off the east coast of Africa, the Mozambique Rovuma Offshore Area 1 project is ONGC Videsh’s key natural gas project. The project is progressing towards developing initially an onshore LNG plant consisting of two LNG trains with total nameplate capacity of 12.88 mmtpa to support the development of the Golfinho-Atum field located entirely within Offshore Area 1. With the approval of the development plan in February 2018, ongoing resettlement implementation activities, site preparation and execution of these SPAs, the project is poised to take FID in H1 2019.

ONGC Videsh holds 16% interest in the Mozambique Rovuma Area-1 Offshore Project out of which 10% participating interest is held directly by ONGC Videsh and another 6% interest is held through its 60% shareholding in ‘Beas Rovuma Energy Mozambique Limited’ (BREML). The remaining 40% shares in BREML are held by Oil India Limited (‘OIL’). Anadarko Moçambique Área 1, Lda is the operator of the project with 26.5% and the other partners are Mitsui E&P Mozambique Area1 Ltd. (20%), ENH (15%), BPRL (10%) and PTTEP (8.5%).