Page 14 - DMEA Week 48 2020

DMEA LNG DMEA

Exxon, Total in talks over Mozambique

resource-sharing deal

MOZAMBIQUE EXXONMOBIL and Total are reportedly in base is Area 4, estimated to contain over 2.4 tril-
talks over how to divide up gas resources from lion cubic metres of gas.
At stake are an a field that straddles their respective LNG devel- Total and its partners already took an FID
estimated 680bn cubic opments off the coast of Mozambique. on the $20bn Mozambique LNG last year, and
metres of gas straddling ExxonMobil is leading a consortium that over the summer secured nearly $15bn in exter-
the two projects. is developing the Rovuma LNG project off the nal financing for the initiative. That project will
southern African country, while Total is in produce up to 13.1mn tpy of LNG from the
charge of the Mozambique LNG venture. Nego- Golfinho and Atum fields in Area 1, thought to
tiations between the pair over resource-sharing hold 2.1 trillion cubic metres of gas. Commercial
also involve Mozambique’s government, which operations are anticipated to start in 2024.
will have the final say over any settlement deal, The current resource-sharing contract was
Reuters reported on November 25 citing sources. signed by Italy’s Eni and Anadarko, which is now
The field in question contains gas that is part of fellow Texas-based producer Occidental
thicker and therefore cheaper to recover and Petroleum. But Eni sold its stake in Rovuma
convert into LNG than the projects’ other depos- LNG to ExxonMobil in 2017, while Anadarko
its, according to Reuters. How much each project transferred Mozambique LNG to Total last year.
could extract from the field was settled in a 2015 At stake are an estimated 680bn cubic metres
“unitisation” or resource-sharing agreement, the of gas straddling the two projects, according to
news agency said. Reuters. The resources are split evenly under the
However, the coronavirus (COVID-19) pan- 2015 agreement.
demic and the resulting collapse in gas prices “As a matter of practice, we do not comment
this year mean both Exxon and Total are under on third-party rumour of speculation,” Exxon
heightened pressure to cut costs. The pressure told the news agency. “ExxonMobil continues to
is greater for Exxon and its partners, which are actively work with its partners and the govern-
yet to take a final investment decision (FID) ment to optimise development plans by improv-
at Rovuma LNG. The US major had hoped to ing synergies and exploring opportunities
sanction the project this year but has delayed the related to the current lower-cost environment.”
move until 2021. Total, meanwhile, said the operators of the
Rovuma LNG is expected to host two liq- two projects “continue working together to
uefaction trains capable of producing 15.2mn maximise synergies and optimise future phases
tonnes per year (tpy) of LNG in total. Its resource of development.” ™

P14 www. NEWSBASE .com Week 48 03•December•2020