Thursday, October 28, 2021

Mozambique Unaware of Total, Exxon Offshore Resource Sharing Talks

Manuel Mucari;
Friday, November 27, 2020

Mozambique's National Petroleum Institute said on Friday it had not yet been notified of any intention by ExxonMobil and Total to renegotiate a resource-sharing agreement for their massive LNG projects in the country.

Reuters reported earlier this week that the two oil majors were in talks with one another to increase the amount of gas they can extract from a shared field that straddles their two blockbuster liquefied natural gas (LNG) developments, worth a combined $50 billion, in a bid to cut costs.

Any change to the resource-sharing - or "unitisation" - agreement governing the amount of gas each can extract has to be approved by the Mozambican authorities.

In a response to emailed questions on the matter, Carlos Zacarias, chairman of the INP, the body that governs Mozambique's energy development, said it had "not yet been notified" of the oil firms' talks on the agreement, and it was not currently party to any discussions.

"There might be a need to assess and see how (changes to the agreement) would impact on the project lifespan, but of course the increase in production with limited or no additional investment should mean more revenues for the Mozambican state," he said.

Reuters also reported that Exxon was now not expected to take a final investment decision for its project until early 2022. This had been due this year but was delayed in April, and the Mozambique government has said it anticipated it next year.

"The FID is decided by the concessionaires when the market conditions are created," Zacarias said. "However the delay in the decision may delay the beginning of the project, which is not desirable."

(Reporting by Manuel Mucari; Writing by Emma Rumney; editing by David Evans)

Categories: Industry News Activity Energy Gas Africa LNG

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