Italian oil firm Eni has reached
a deal to sell a multi-billion dollar
stake in its planned Mozambique liquefied natural gas (LNG) development to
Exxon Mobil, two sources with knowledge of the matter told CNBC.
"The deal is done but
won't be announced for several months at Exxon's request," one of the
sources said.
Eni declined to comment,
while a spokesman for Exxon said, "We do not comment on market rumours or
speculation".
The offshore gas reserves
already discovered by Eni in Area 4 are large enough to need a giant land-based
LNG export plant whose proximity to Asian and Middle Eastern growth markets makes
it potentially a highly-lucrative project.
But talks to bring in a
technically-savvy partner with deep pockets like Exxon have dragged on due to a
differences over valuations in the light of falling oil and gas prices.
In 2013 Eni sold 20 percent
of its Area 4 licence to China's CNPC for $4.2 billion but since then oil and
gas prices have come down by more than half.
However, last year
Mozambique awarded Exxon three offshore exploration licence blocks of its own
which sit to the south of Eni's discoveries, giving a new dimension to
development prospects.
"As you are aware, on
October 28, 2015, Exxon was awarded three offshore blocks in Mozambique,"
the spokesman for Exxon said.
"We look forward to
further discussions with the Mozambique government on the development of a
production-sharing contract for the blocks."
Eni has been reluctant to
sell too much of its 50 percent stake in the Area 4 permit where as operator it
has already found 85 trillion cubic feet of gas.
But in recent weeks Eni
Chief Executive Claudio Descalzi has raised the possibility of it selling up to
a 25 percent stake, up from the 10-15 percent previously on offer.
The two sources said after
lengthy talks, Eni and Exxon have now agreed terms and "sealed" a
deal that could give Exxon its desired operating stake in the onshore LNG
export plant while Eni would retain control over the Area 4 gas fields feeding
it.
Last week Descalzi
reiterated Eni's desire to remain operator for the gas fields.
"Our model is to remain
and keep the operatorship or keep, in any case, a clear control on the asset -
the asset that we discovered," he told analysts.
While Eni will export gas as
LNG from at least one floating offshore platform in the Coral field development
in Area 4, the main focus of work will be on the larger land-based plants.
The Coral field will remain
outside the scope of the deal with Exxon, the sources said, and Eni has
earmarked LNG from the Phase I development of Coral to BP.
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