ONGC Videsh, Oil India and Bharat Petroleum Corporation along with operator US-based Anadarko Petroleum and other partners announced the final investment decision (FID) of $20 billion for Rovuma Offshore Area-1 Mozambique LNG project.
The investment will go towards construction of a gas liquefaction and export terminal and the project will initially consist of two LNG trains with a total nameplate capacity of 12.88 million tonne per annum, the three Indian firms said in separate regulatory filings on Wednesday. The project is expected to be commissioned by 2024.
Earlier this month, a ministerial group including home minister Amit Shah had given its nod to the investment plan by the Indian companies in the gas field in Mozambique where 75 trillion cubic feet of natural gas has been discovered. The group of ministers comprising finance minister Nirmala Sitharaman, commerce and railway minister Piyush Goyal, external affairs minister S Jaishankar, and petroleum and steel minister Dharmendra Pradhan had met on June 4 to scrutiny the investment plan as it is still to be approved by the Cabinet Committee on Economic Affairs.
In 2013, OVL bought Videocon s 10% stake in the project for $2.475 billion and a similar stake from Anadarko for $2.64 billion. Later, OVL gave 4% of its stake to OIL. BPCL, through its unit, Bharat PetroResources, has paid $703 million to buy the 10% in the project.
While Anadarko Petroleum holds 26.5% in the project, other partners include ENH Rovuma Area (15%), Mitsui E&P Mozambique Area1 (20%) and PTTEP Mozambique Area 1 (8.5%).
The project will include construction of associated infrastructure, export jetty and storage tanks. The produce from the project will be supplied to Tokyo Gas, Centrica, Shell, China s CNOOC, France s EDF and Indonesia s Pertamina, among others. The project has successfully secured in aggregate 11.1 MMTPA of long-term LNG sales (representing 86% of the plant s nameplate capacity) with key LNG buyers in Asia and in Europe. Additionally, the project will have a significant domestic gas component for in-country consumption to help fuel economic development, OIL said in its filing.
As reported by FE earlier, the Indian companies have already sought approvals for more investments.
Meanwhile, operator of the project Anadarko is set to be taken over by another US-based firm Occidental Petroleum. Post the deal, Occidental will sell Anadarko s assets, including the Mozambique LNG project, to French oil firm Total in a $8.8-billion deal which is expected to be closed by 2020.