CNPC in talks with Eni for US$4b gas assets in Mozambique
China's oil giant targets stake in Mozambique project in its biggest overseas investment
China National Petroleum Corp, the country's biggest oil company, is in talks with Eni for a stake in a gas project in Mozambique valued at as much as US$4 billion, according to two people with knowledge of the matter.
Italy's largest oil firm might sell a 20 per cent stake in a gas block to CNPC to share the cost of developing the project, the people said, asking not to be identified because the talks are private.
The companies had been in talks for at least six months and final terms had yet to be agreed upon, they said.
The deal would, if completed, rank as the biggest overseas investment made by CNPC or its listed unit PetroChina. China's largest producers have bought African oil and gas fields in countries ranging from Nigeria to Uganda to feed energy demand in the economy.
Mozambique's offshore fields might hold enough gas to meet world consumption for more than two years, the national oil company said. Eni and Anadarko Petroleum, the two companies leading exploration in Mozambique, agreed last year to build the world's second-largest liquefied gas export plant to start sending fuel abroad in 2018.
An official at Eni declined to comment. So did Liu Weijiang, a Beijing-based spokesman at CNPC.
Eni has a 50 per cent stake in Mozambique's Area 4, where it has discovered about 75 trillion cubic feet of natural gas so far, the biggest find in the company's history. The whole country may have 250 trillion cu ft of reserves, according to Empresa Nacional de Hidrocarbonetos, Mozambique's state-backed energy company.
Anadarko and its partner Videocon Industries were in the process of selling a combined stake in Mozambique's Area 1, the block neighbouring Eni's, a person with knowledge of the matter said. Anadarko, the block's operator, may cut its stake from 36.5 per cent to 26.5 per cent, and Videocon is looking to sell its entire 10 per cent stake. Initial bids were due by March 14, the person said.
Anadarko's chief executive said last month that the company was in discussions with a number of parties.
