New Delhi: ONGC Videsh Ltd, Oil India Ltd and their partners have received the Mozambique government’s nod for bringing to production a giant gas field in the prolific Rovuma Area-1, off the coast of the African nation. Partners in the block plan to turn the gas into LNG for exports.

In a press statement, state-owned Oil India Ltd said the Mozambique government has “accorded approval for the development plan for the Golfinho-Atum natural gas field in the Area-1 block located in the Rovuma offshore basin of Mozambique".

The Area 1 block is estimated to hold recoverable gas resources of about 75 trillion cubic feet, more than the combined resource in all of the gas fields in India.

“The approval of the Development Plan is the culmination of several years of progress on technical and commercial aspects of the development," OIL said without giving details of the investment planned. The Golfino-Atum project will be Mozambique’s first onshore LNG development.

“The plan outlines the integrated development of the Golfinho-Atum field through an initial two-train onshore liquefaction (LNG) plant with a total processing capacity of 12.88 million tonnes per annum," it said adding volumes in future may rise up to 50 million tonnes a year.

The project will also supply initial volumes of about 100 million cubic feet of natural gas per day for domestic sales in Mozambique. ONGC Videsh Ltd, the overseas arm of state-owned Oil and Natural Gas Corp. (ONGC), holds 16% stake in the block while OIL has 4%.

US energy major Anadarko Petroleum Corp. is the operator with 26.5% interest, while Mitsui of Japan has 20%, Bharat PetroResources Ltd (a unit of state-owned BPCL) 10% and ENH 15%. OIL said the approval of the development plan is a significant milestone in achieving final investment decision (FID) for the project.

The nod paves way for legal and contractual framework agreements, commencement of resettlement implementation activities, site preparation, efforts to secure long-term LNG sales/offtake agreement and work towards project financing.

Last month, Anadarko had stated that Mozambique LNG1 Company Pvt. Ltd, the jointly owned sales entity of the Mozambique Area 1 co-venturers, has sold 1.2 million tonnes per annum of LNG from the project to French electricity utility EDF for a term of 15 years.

The LNG project will initially consist of two LNG trains with a total nameplate capacity of 12.88 million tonnes per annum to support the development of the Golfinho/Atum fields located entirely within Offshore Area 1.

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