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ENI sells Mozambique stake to CNPC for $4.21bn

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(Globalpost/GlobalPost)

Italian energy group Eni said Thursday it has sold a 20 percent stake in an offshore energy field known as Area 4 in Mozambique to China's state-owned giant CNPC for $4.21 billion.

"CNPC’s entrance into Area 4 is strategically important for the project thanks to the worldwide relevance of the new partner in the upstream and downstream sectors," Eni said in a statement.

The transaction will take place via the sale by Eni to China National Petroleum Corporation of a 28.57 percent holding in Eni East Africa, which owns 70 percent of Area 4, indirectly giving CNPC a 20 percent stake in the asset which lies north of the country, around 2,000 kilometers (1,250 miles) from the capital, Maputo.

Eni will retain 50-percent ownership of Area 4, which is situated in the Rovuma basin at a depth of around 2,600 metres (1.6 miles).

The rest is already owned in equal parts by Empresa Nacional de Hidrocarbonetos de Mocambique, Kogas and Galp Energia.

Completion of the transaction is still subject to approval by authorities in Mozambique, the statement said.

Since obtaining an exploration license for the field in 2006, Eni has discovered gas reserves in three zones, and estimates Area 4's gas potential at 1.974 billion cubic metres (69.7 cubic feet).

In China, Eni and CNPC also agreed to jointly study the development of the Rongchang shale gas block, which covers 2,000 square kilometres (770 square miles) in the Sichuan Basin, and which Eni said "has proven to be the most promising in the country to date".

In Milan, Eni shares jumped by 2.01 percent in morning trading to 18.29 euros, while the FTSE Mib index on which they are traded was 1.0 percent higher overall.

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http://www.globalpost.com/dispatch/news/afp/130314/eni-sells-mozambique-stake-cnpc-421bn-0