05
Nov
India, Mozambique Enter New Oil Deal
An approval has been granted by the Indian government for an oil and gas deal between the Asian powerhouse and Mozambique that will synergize both countries in upstream and downstream activities while also encouraging and promoting trade, investment and technological transfers.
“Mozambique is strategically located near India and is ideally suited for bringing natural gas to India. The participation of Indian energy companies will facilitate access to liquefied natural gas (LNG) for the growing Indian gas market,” read a statement from the Mozambican government.
Gas reserves, reportedly, have increased in Mozambique from 5 trillion cubic feet to over 200 trillion cubic feet in the past half-decade and the government estimates that an investment of the order of $50 billion can fully harness the gas discovered around the northern coast of the country. The new deal with India might help the Southern African nation cash in on these possibilities.
These prospects have attracted a number of international players to Mozambique, the most notable being US company Anadarko and Italy’s ENI. The companies plan to make their first shipment in 2018, a goal seen by many as a tall order. Once exports begin, however, the country will definitely be en route to becoming one of the main producers of Liquefied Natural Gas (LNG) on earth.
Shell, a pioneer of the LNG sector since 1964, describes it as a colourless, odourless and non-toxic liquid that can be transported and stored more easily than natural gas, which has huge demands globally, because it is compressed and converted to liquid thereby occupying 600 times less space than the original natural gas from which it is derived. The technology makes sense because it is economically impractical to transport natural gas by pipelines over long distances.
The LNG, when it reaches its destination, is reconverted to gas at regasification facilities and can then be piped over shorter distances to homes and commercial centres. This technology has been adopted by other players in the oil & gas space as demand for natural gas continues to soar globally.
In moves to further explore its potentials in oil & gas, the Mozambican government has also called for bids from companies wishing to check out fifteen new blocks totalling an area of 76,800 sq kilometers in the hope that precious deposits of gas and petroleum will be discovered.
Source: http://www.ventures-africa.com/2014/11/india-mozambique-enter-new-oil-deal/