Gazprom Said to Seek Stake in Eni’s Mozambique Gas Assets

OAO Gazprom (GAZP) is seeking a stake in Eni SpA (ENI)’s Mozambique assets as Russia’s gas export monopoly strengthens its partnership with Italy’s largest oil company, according to two people with knowledge of the matter.

Gazprom has been discussing the acquisition of a stake in Mozambique’s Area 4, where Eni has discovered 75 trillion cubic feet of gas in offshore fields, said the people, asking not to be identified because talks are private. The size of the stake has yet to be agreed on in negotiations that may not end in a deal, they said.

Gazprom is “interested in the asset,” Sergei Kupriyanov, a spokesman, confirmed today by phone. Eni declined to comment.

Eni sold a 20 percent stake in Area 4 last week to China National Petroleum Corp. for $4.2 billion to spread the cost of developing the world’s second-largest liquefied natural gas export plant to ship the fuel from Mozambique. The Rome-based company now has 50 percent. Eni and state-controlled Gazprom are already partners in Russian gas producer OOO SeverEnergia.

Russian President Vladimir Putin plans to meet his Mozambique counterpart, Armando Guebuza, at a summit in South Africa next week, where they’ll discuss investment in the East African country’s energy industry, the people said. OAO Rosneft (ROSN), Russia’s largest oil producer, is also interested in participating in projects, they said.

Putin’s spokesman Dmitry Peskov declined to comment on the meeting or its agenda.

LNG Exports

Mozambique’s gas discoveries, the world’s largest in a decade, sparked interest among global energy producers seeking access to new reserves. The East African country’s offshore fields may hold enough gas to meet world consumption for more than two years, according to Empresa Nacional de Hidrocarbonetos, the state-backed petroleum exploration company.

Eni and Anadarko Petroleum Corp. (APC), the two companies leading exploration in Mozambique, agreed last year to jointly build the world’s second-largest LNG export plant, with shipments planned to start in 2018.

Anadarko and Videocon Industries Ltd. (VCLF) are selling 10 percent each in the Rovuma-1 field in Mozambique, as the developers of the gas projects aim to cut costs. Oil & Natural Gas Corp. (ONGC) and Oil India Ltd. (OINL), Indian state-run energy companies, made a joint bid to buy a 20 percent stake in that field, a person with direct knowledge of the matter said on March 14.

‘Asset Swap’

State-run Rosneft last month announced plans to develop LNG projects as Chief Executive Officer Igor Sechin urged Putin to break Gazprom’s monopoly on exports of the super-chilled fuel to allow Russia to expand in the growing LNG market.

Rosneft in 2012 signed a strategic cooperation accord with Eni, giving the Italian producer access to Russian blocks in the Arctic and the Black Sea. In return, the deal gives Rosneft the opportunity to participate in Eni’s international projects.

Gazprom is looking into some assets with “lots of capacity” in Mozambique, Gazprom Deputy CEO Alexander Medvedev said in an interview in February 2012. The company is looking at an “asset swap” with a firm already working in the African nation, he said.

To contact the reporters on this story: Ilya Arkhipov in Moscow at iarkhipov@bloomberg.net; Anna Shiryaevskaya in Moscow at ashiryaevska@bloomberg.net; Alessandra Migliaccio in Rome at amigliaccio@bloomberg.net

To contact the editors responsible for this story: Will Kennedy at wkennedy3@bloomberg.net; Balazs Penz at bpenz@bloomberg.net

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