State-run ONGC, OIL and BPCL will in the next four years invest USD 6 billion in developing a giant gas field off the Mozambique coast and...
State-run ONGC, OIL and BPCL will in the next four years invest USD 6 billion in developing a giant gas field off the Mozambique coast and converting the fuel into LNG for export to nations like India, Oil Minister Dharmendra Pradhan said today.
ONGC Videsh Ltd, the overseas arm of Oil and Natural Gas Corp (ONGC), Oil India Ltd and a unit of Bharat Petroleum Corp Ltd (BPCL) together hold 30 per cent interest in Rovuma Area-1, which is estimated to hold recoverable gas reserves of up to 75 trillion cubic feet.
“We have invested more than USD 6 billion so far (in the Mozambique field) and another USD 6 billion will be invested by 2019 to develop Rovuma Area-1 field,” he said here.
An estimated USD 18.4 billion will be required to bring first set of discoveries in Rovuma Area-1 on to production and convert that gas into liquid (liquefied natural gas or LNG) for ease of shipping to consuming nations like India.
OVL’s share would be USD 2.944 billion.
Pradhan, who returned from a two-day visit to the African nation last night, said the first LNG from the block is targeted for 2018-end or early 2019.
The project with capacity to produce 20 million tonnes of LNG annually would be the world’s largest LNG export site after ExxonMobil-run Ras Laffan in Qatar.
OVL had in 2013 bought Videocon’s 10 per cent stake in the Rovuma Area-1 for USD 2.475 billion. It followed this up by acquiring another 10 per cent stake in the same field from Anadarko Petroleum Corp of the US for USD 2.64 billion. The 10 per cent stake of Videocon was split in 60:40 ratio with OIL.
“I had a very successful tour to Mozambique… we are getting full cooperation from the Mozambique government for early development and monetisation of Rouvma Area 1,” he said.
Pradhan said the block consortium is talking to Indian buyers like state gas utility GAIL for selling LNG.
“If it fetches more money (to us) by selling the LNG then and there itself, we will opt for that. But if it is beneficial to bring the gas to India, we will certainly look at that option,” he said.
Rovuma Area-1 Offshore Mozambique Block (Block Area 1) is located along the coasts of northern Mozambique and southern Tanzania in the Indian Ocean. It has a total area of more than 10,000 square kilometres in water depths ranging 900 metres to 1,600 metres and about 30-60 kms from shore.
Woodlands, Texas-based energy-exploration company Anadarko is the operator of the block with 26.5 per cent stake while a unit of BPCL has 10 per cent interest. Other partners in Area 1 include Mitsui with 20 per cent stake, ENH (15 per cent) and PTTEP (8.5 per cent).
So far, seven gas fields have been discovered in the block. Of these, three fields – Lagosta, Windjammer and Barquentine (collectively called the Prosperidade field) – extend into the adjacent Block Area-4 where Italy’s ENI with a 70 per stake is the operator.
The others – Atum, Golfinho and a small field Tubarao, are independent fields lying fully in Block Area-1.
Sources said the consortium is looking at developing the independent fields first.
Pradhan said, during his visit to Mozambique on April 9 and 10, he met Prime Minister Agostino Rosario and Foreign Minister Baloi. He also had a meeting with his counterpart, Minister of Mineral Resources & Energy Pedro Couto.
“Rovuma Area-1 is the largest investment of India in any single hydrocarbon asset abroad,” he said.
During the meetings, the two sides discussed all issues related to the existing investment as well as ways to expand the relationship in other areas of oil and gas. “It was agreed that there is scope for expanding cooperation in several areas of mutual interest,” he said.