But NGD understands not all of Area 4’s shareholders are keen to push forward with the development as
it stands. Given the high cost of Coral, some members are keen to postpone an FID until oil prices
While the bulk of lending from the project is expected to come from Korean, Chinese and Italian export
credit agencies, the Area 4 consortium will also look for support from commercial banks, discussions
with which are still in an early stage.
Exxon has long been interested in East African gas, but the Shell/BG Group merger may have increased
the company’s desire to make a greater play for Mozambique.
Sources familiar with the matter told the WSJ Exxon is said to have an interest in becoming an operator
in the development, and a banking source told Reuters the company could look to buy the full 50% stake
in Area 4.
However, sources in Maputo have told NGD Eni is keen to remain operator of the block.
“Shell buying BG put pressure on Exxon to respond in the gas space. They were always interested in
Mozambique, but it was just a question of the price,” one London-based oil and gas analyst told NGD.
As well as negotiations to buy Eni’s Area 4 stake, Exxon is still rumoured to be one of the frontrunners to
buy Anadarko’s 26.5% stake in neighbouring Area 1.
Exxon won three exploration blocks in Mozambique’s fifth licensing round last October. The company
also has a 35% stake in Block 2 offshore Tanzania – one of four blocks intended to feed into the planned
10 mtpa LNG plant in Lindi.
If the US supermajor becomes the operator of Mozambique’s LNG projects it would give it huge leverage
over the pace of gas developments in both Mozambique and Tanzania, one Dar es Salaam-based oil and
gas expert told NGD.
“While Exxon only has a small stake in the Tanzania LNG project company, because the development is
still at such an early stage it still wields a lot of influence. It could give it the ability to speed things up in
Mozambique and slow them down in Tanzania, if that’s what it wants,” the source said.