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Area 4: Government Awaits Further Details to Formalise Sale of Galp Shares

Area 4: Government Awaits Further Details to Formalise Sale of Galp Shares

The Chairman of the Board of Directors (chairmans) of the National Petroleum Institute (INP), Nazário Bangalane, said that the government is waiting for more details to formalise and speed up the sale of the shares of Portuguese oil company Galp in the liquefied natural gas (LNG) project in Area 4 of the Rovuma basin in Cabo Delgado.

“This is something that is provided for by law and everything follows certain procedures. Galp now has the task of officially submitting the sale process, which will be analysed by the government, so that we know the in-depth details of the contract,’ he explained, quoted by Semanário Económico.

Bangalane emphasised that it is in the government’s interest to speed up the process so that work in the Rovuma basin can continue as normal and within the approved standards.

‘We can’t predict the right time for everything to take place, but it’s obvious that we want to bring this matter to a close as soon as possible,’ he added.

Last month, Galp announced that it had reached an agreement with the United Arab Emirates oil company, ADNOC, to sell its position in the consortium researching natural gas in the Rovuma basin, for almost 41.1 billion meticals (600 million euros).

In a statement to the Portuguese Securities Market Commission (CMVM), Galp announced that it will sell its 10% stake in Area 4, an operation that should be finalised by the end of the year, following its ‘disciplined’ investment strategy.

‘Area 4 includes the Coral South FLNG (floating platform), operating since 2022, as well as the onshore developments in the prospective Coral North FLNG and Rovuma LNG, both expected to be approved in 2024/2025,’ the document states.

The company should receive 41.1 billion meticals (600 million euros) for its shares and shareholder loans, already net of capital gains taxes.

The agreement also provides for ‘additional contingent payments of 6.3 billion meticals (100 million dollars) and 25.2 billion meticals (400 million dollars), with the final investment decision for Coral Norte and Rovuma LNG, respectively’.

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Area 4 is operated by Mozambique Rovuma Venture (MRV), a joint venture co-owned by ExxonMobil, Eni and CNPC (China), which has a 70 per cent stake in the concession contract.

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