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Targeting production of 24 Tcf of natural gas, Anadarko and other project concessionaires agree on operating natural gas fields offshore Mozambique

Anadarko Petroleum Corp. (ticker: APC) announced today that it reached an agreement with concessionaires in its Offshore Area 1 Mozambique natural gas field, as well as the concessionaires of Offshore Area 4, operated by Eni’s (ticker: E) East Africa subsidiary, for the operation and development of the adjoining natural gas assets. The companies signed a Unitization and Unit Operating Agreement (UUOA) today, targeting the production of 24 Tcf of natural gas off the coast of Africa.

The Prosperidade and Mamba straddling natural gas reservoirs, which comprise the UUOA area, will be developed “in a separate but coordinated manner by the two operators” until 12 Tcf has been developed in each area, according to an Anadarko press release. Once the two reservoirs have been developed for a joint total of 24 Tcf, all subsequent development will be pursued through a joint-venture operator (50/50 Anadarko and Eni).


The UUOA was approved by the Government of Mozambique, along with a Memorandum of Understanding (MOU) reached between Anadarko and the Government of Mozambique for the company to provide 100 MMcf/d of LNG from its Mozambique LNG project.

The LNG plant will be supplied by Offshore Area 1, which will provide initial volumes of approximately 50 MMcf/d per train for a total of 100 MMcf/d. The LNG produced under the terms of the MOU will be used domestically, Anadarko said in its statement. The concessionaires also said that they would be willing to sell up to 300 MMcf/d of additional volumes into the domestic market in the future as the project matures.

The pricing of the LNG produced from the project will be “provided at pricing that is fair to all parties and supports local natural gas development,” but Anadarko Executive Vice President of Global LNG Mitch Ingram said the company looks forward to developing natural gas for export as well.

“We look forward to continuing to work with the Government of Mozambique to finalize the legal and contractual framework that will enable us to deliver natural gas for domestic projects and LNG cargoes for export to premium markets around the world,” said Ingram.

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