Eni plans $50bn investment on Mozambique gas

12 November 2011, Sweetcrude, Milan-Italian oil and gas company Eni SpA will invest $50 billion developing its huge Mozambique natural gas discovery with a view to exporting the gas to Asian markets, its Chief Executive Paolo Scaroni said in an interview Friday after a visit to East Africa.

Dow Jones newswire reports that Eni’s recent discovery of 22.5 trillion cubic feet of natural gas in Mozambique, and earlier discoveries in Tanzania, are part of the transformation of East Africa into an oil and gas hub.

Already, the Italian oil conglomerate has said it plans to build its own liquefied natural gas (LNG) terminal in Mozambique after it made its biggest ever gas find.

“We have the means to go it alone”, Scaroni told reporters in a conference call last month hours after the company announced it had made the biggest operated discovery in its history in a giant natural gas find off Mozambique.

Scaroni said that by the end of the project, Mozambique could produce around 300,000 barrels of oil equivalent per day.

The discovery, at Eni’s Mamba South 1 prospect, Area 4, saw a discovery well encounter a total of 212 metres of continuous gas pay in high-quality Oligocene sands, the company said in a statement on Thursday.

The well is located in water depths of 1585 metres about 40 km off Cabo Delgado coast in the northern offshore of Mozambique. It will be drilled to reach an expected total depth of around 5000 metres.

After completion of drilling and testing activities, the rig will move to drill the second commitment well, Mamba North 1.

Eni said it believes the discovery could lead to at least 15 trillion cubic feet of gas in place in the Mamba South Area, where the potential of the Tertiary Play will be further drilled and assessed.

“These results exceed pre-drill expectations and confirm the Rovuma Basin as a world-class natural gas province”, the company said.

“The outstanding volume of natural gas discovered will lead to a large scale gas development with a combination of both export to regional and international markets through LNG and supply to the domestic market”, the statement continued.

Eni said the resource potential of the well would open “a new eastern front” in its African activities.

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