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Total completes acquisition of Anadarko’s Mozambique LNG stake
INVESTMENT
FRANCE’S Total has completed its $3.9bn acquisition of Anadarko Petroleum’s 26.5% operated interest in the Mozambique LNG project. Total agreed in May to buy the stake from Occidental Petroleum after the latter out- bid Chevron to take over Anadarko earlier this year. The transaction forms part of a package that comprises all of Anadarko’s African assets, spread across Mozambique, Algeria, Ghana and South Africa, for which the French company will pay $8.8bn in total. The purchase of the other assets is still in the process of being closed, Total said in a September 30 statement.
A final investment decision (FID) on Mozambique LNG was reached in June, when Occidental’s takeover of Anadarko was already underway. The $20bn project is the largest ever oil and gas venture to be sanctioned in sub-Sa- haran Africa, as well as being Mozambique’s first onshore LNG development. The project is expected to come online by 2024, and 90% of its production has already been sold through long- term contracts with buyers in Asia and Europe.
The other partners in the project are Mozam- bique’s ENH, Japan’s Mitsui & Co., India’s ONGC Videsh Ltd (OVL), Oil India Ltd (OIL) and Bharat PetroResources Ltd (BPRL) and Thai- land’s PTT Exploration & Production (PTTEP).
Separately, it was reported this week that the board of directors of the Export-Import Bank of the US (EXIM) had voted unanimously to authorise a direct loan of up to $5bn to aid the development and construction of Mozambique LNG. The financing is expected to support US exports of goods and services for the engineer- ing, procurement and construction (EPC) of the terminal and related facilities.
Meanwhile, Mozambican President Filipe Nyusi has said he hopes Occidental’s takeover of Anadarko will generate extra tax revenue for his government. Nyusi said last week that Maputo intended to collect capital gains tax from Anadarko because that company had sold its Mozambican assets to Total after agreeing to the buyout deal with Occidental. Maputo expects the US company to pay $880mn, he said.
The transaction forms part of a package that comprises all of Anadarko’s African assets.
The president was speaking after meeting with representatives of Total and Occidental in the city of Chimoio. As of press time, neither company had commented on his remarks.
This is not the first time Mozambique’s gov- ernment has issued such a demand. In 2017, Maputo instructed Italy’s Eni to pay $350mn in capital gains tax after it sold a stake in Coral South, a natural gas field, to super-major ExxonMobil.
Expanding position
“Mozambique LNG is [a] one of a kind asset that perfectly fits with our strategy and expands our position in liquefied natural gas”, said Total’s chairman and CEO, Patrick Pouyanné. The French company also recently bought Toshiba’s US LNG business for $15mn as it continues to grow its LNG portfolio. That deal includes a 20-year tolling agreement for 2.2mn tonnes per year (tpy) of LNG from the third train at Free- port LNG in Texas and the corresponding gas transportation agreements on the pipelines feed- ing the terminal. Freeport LNG’s Train 3 is due to enter service by the second quarter of 2020.
“The takeover of Toshiba’s LNG portfolio is in line with Total’s strategy to become a major LNG portfolio player. Adding 2.2mn tpy of LNG to our existing positions in the US, in particular Cameron LNG, will enable optimisations of the supply and operations of these LNG sources,” Total’s president of gas, renewables and power, Philippe Sauquet, said last month. “Already an integrated player in the US gas market, Total is set to become one of the leading US LNG export- ers by 2020 with a 7mn tpy portfolio.”
Total is also continuing to develop its LNG projects in Africa beyond Mozambique. The company said last week that it anticipates an FID on Train 7 at Nigeria LNG by the end of this year. (See next story)™
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w w w . N E W S B A S E . c o m Week 39 03•October•2019