Final decision on OVL’s Mozambique project likely by first half of 2019

Twesh Mishra New Delhi | Updated on December 05, 2018

The final investment decision on ONGC Videsh’s multi-billion dollar Mozambique project will be taken in the first half of 2019 calendar year, a company executive said.

Earlier, OVL — the overseas investment arm of ONGC — was expecting a decision by the month-end. “There has been a slight delay, which is a normal, considering the size of the project,” a senior OVL executive told BusinessLine.

Development plan

“The final investment decision on the Mozambique project is now going to come in the first half of next year. First gas production from the project will start within 36-48 months after the approval — in 2022-23,” the official said.

OVL is expected to spend around $4.5 billion for developing the project. ONGC Videsh had announced the approval of the development plan for Golfinho-Atum field in the Rovuma Area 1 Offshore Block in Mozambique in March this year.

An OVL statement had said that the plan outlined the integrated development of the Golfinho-Atum field through an initial two-train onshore liquefaction plant with a total processing capacity of 12.88 million tonne per annum.

“The approval of the development plan is the culmination of several years of progress on technical and commercial aspects of the development. The Golfinho-Atum project will also supply initial volumes of approximately 100 million cubic feet of natural gas per day for domestic sales for Mozambique’s industrial development,” the statement had said.

The Area 1 block located in the deep-water Rovuma Basin offshore Mozambique is one of the largest gas discoveries in offshore East Africa with estimated recoverable resources of approximately 75 trillion cubic feet, the statement added.

Stake details

ONGC Videsh presently holds 16 per cent net interest in the Mozambique Rovuma Area-1 Offshore Project out of which 10 per cent Participating Interest (PI) is held directly by ONGC Videsh and another 6 per cent is held through its 60 per cent shareholding in Beas Rovuma Energy Mozambique Ltd (BREML). The remaining 40 per cent shares in BREML are held by Oil India Ltd.

Anadarko Petroleum Corporation is the operator of this project with 26.5 per cent PI. The other partners are: Mitsui (20 per cent), ENH (15 per cent), BPRL (10 per cent) and PTTEP (8.5 per cent).

Published on December 05, 2018

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