On Nov. 18, Eni finalized plans to develop Mozambique's Coral South offshore gas project, part of a larger scheme that will see Italy's top energy company and partners spend an estimated $50 billion.
Eni has discovered huge gas reserves in its Area 4 concession, offering Mozambique, one of the world's poorest countries, potentially lucrative LNG exports.
The Coral South project will require the construction of six subsea wells connected to a floating production facility capable of producing more than 3.3 million tonnes of LNG per year, Eni said.
Nov. 18's approval by Eni's board of directors clears the way for the final investment decision (FID) on the deepwater Coral South project once Eni's partners also approve it and financing has been underwritten.
Mozambique authorities approved the project's development plan in February and Eni has said it expects the FID in 2016.
In October, Eni signed a 20-year deal to supply BP Plc (NYSE: BP) with LNG from the project.
The Coral South Field, discovered in May 2012, contains about 450 billion cubic meters (Bcm), or 16 Tcf, of gas in place.
Overall reserves discovered in Mozambique's Rovuma Basin in recent years amount to about 85 Tcf, making it one of the largest finds in a decade with enough gas to supply Germany, the U.K., France and Italy for nearly two decades.
Eni is the operator of Area 4 and holds a 50% indirect stake held through Eni East Africa, which owns a 70% stake in Area 4. Galp Energia, KOGAS and Mozambique's state energy firm ENH each own 10%. China's CNPC owns a 20% indirect interest in Area 4 through Eni East Africa.
Final approval of the project could add impetus to Eni's efforts to raise several billion dollars by selling down its stake in Area 4 and bring onboard another partner or partners to help develop the field. Sources told Reuters that ExxoMobil Corp. (NYSE: XOM) has already clinched a deal to buy a stake in Area 4.
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