Eni To Invest $50B in Giant Mozambique Gas Find

MILAN (Dow Jones Newswires), Nov. 11, 2011

Italian oil and gas company Eni SpA (E) 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.

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 a fast-growing gas hub, and confirms the region's growing importance as a launch pad for exports to gas-hungry Asia.

"We aim to have several liquefiers working for Southeast Asia," Scaroni told Dow Jones Newswires. "The gas is targeted for Asia."

Eni will employ 40,000 people at a new facility in the country's north, near its gas find, Scaroni said.

Eni recently said that it planned to build two or three liquefiers in Mozambique, and that the first gas could be liquefied in 2016.

Friday, Scaroni said it was too soon to talk about income levels from the Mozambique gas field.

"We are still drilling four more wells," he said.

Tanzania, where U.K. gas giant BP PLC (BP) is already operating, has a head start, but Mozambique is catching up quickly and has more gas than its northern neighbor.

Anadarko Petroleum Corp. (APC) also recently reported a major find in Mozambique, and has

begun planning at least two liquefied natural gas facilities capable of exporting to China, South Korea and Japan.

Scaroni met with Mozambique President Armando Guebuza in Maputo Thursday to discuss Eni's investment plans.

"We have to build a new town, and we discussed the location with him," said Scaroni. "It has to be near the discovery, but we all have to agree on where. We had a broad discussion about Eni's investment in the country and what it will mean."

Scaroni noted that as the recent gas discoveries have catapulted Mozambique, one of the world's poorest countries, into the ranks of newly-rich hydrocarbon producers, President Guebuza plans to send advisors to Nigeria and Angola to get familiar with oil and gas operations there.

Scaroni said he also visited South Africa to talk to President Jacob Zuma about exporting some of the Mozambique gas to South Africa.

"We spoke about what the impact of this new gas find will be on the region," he said.

Eni is already exploring for shale gas in South Africa with state-owned oil company PetroSA.

Copyright (c) 2011 Dow Jones & Company, Inc.


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