BP and Area 4 partners sign LNG sale and purchase agreement for offshore Mozambique
BP and the Area 4 concession partners, Eni East Africa (EEA), Galp Energia (Galp), Kogas and Empresa Nactional de Hidrocarbonetos (ENH), today entered into a sales and purchase agreement for BP to purchase 100% of the liquefied natural gas (LNG) produced by the EEA-operated Coral South Floating LNG facility expected to be installed offshore Mozambique.
The agreement covers the purchase of LNG for over 20 years. The agreement, which has been approved by the government of Mozambique, is conditional on the Final Investment Decision (FID) being taken for the project, which is currently expected by the end of 2016. The Coral South Floating LNG facility is expected to have a capacity above 3.3 million tonnes per annum.
BP will use LNG from the contract to help meet its global supply commitments.
Paul Reed, chief executive of BP’s supply and trading business, said: “BP is pleased to play a key role in enabling Mozambique to be an LNG exporting country. The agreement adds to the diversity of our natural gas portfolio beyond the end of the decade, further enhancing our ability to meet the needs of our customers.”
Commercial details of the agreement were not disclosed.
Notes to editors
- BP is active in many of the major LNG producing regions as well as in the main LNG markets. It is involved in LNG projects in Australia, UAE, Indonesia, Egypt, Trinidad and Angola.
- Eni is the operator of Area 4 with a 50% indirect interest, owned through EEA, which holds a 70% stake of Area 4.
- EEA’s partners in Area 4 are Galp, Kogas and ENH with a 10% stake each.
- CNPC owns a 20% indirect interest in Area 4 through EEA.
Cautionary statement
In order to utilize the ‘safe harbor’ provisions of the United States Private Securities Litigation Reform Act of 1995 (the ‘PSLRA’), BP is providing the following cautionary statement. This press release contains certain forward-looking statements concerning the LNG sale and purchase agreement for offshore Mozambique, including plans and expectations regarding expected capacity of the facility and the timing for the final investment decision. Actual results may differ from those expressed in such statements, depending on a variety of factors including changes in public expectations and other changes to business conditions; the timing, quantum and nature of divestments; the receipt of relevant third-party and/or regulatory approvals; future levels of industry product supply; demand and pricing; OPEC quota restrictions; PSA effects; operational problems; regulatory or legal actions; economic and financial conditions generally or in various countries and regions; political stability and economic growth in relevant areas of the world; changes in laws and governmental regulations; exchange rate fluctuations; development and use of new technology; the success or otherwise of partnering; the actions of competitors, trading partners and others; natural disasters and adverse weather conditions; changes in public expectations and other changes to business conditions; wars and acts of terrorism, cyber-attacks or sabotage; and other factors discussed under “Principal risks and uncertainties” in our Stock Exchange Announcement for the period ended 30 June 2016 and under "Risk factors" in our Annual Report and Form 20-F 2015.
