Rosneft, Exxon Sign Mozambique Oil Exploration Deal

The government of Mozambique said on Monday it had signed oil exploration agreements with U.S. energy firm U.S. and Russian oil giants, Exxon Mobil and Russia’s Rosneft, Nezavisimaya Gazeta wrote.

The southern African nation’s National Petroleum Institute, an energy regulator, said the government was preparing to sign similar agreements with South Africa’s Sasol and Italy’s Eni.

The agreements could lead to as much as $700 million of investment in Mozambique as the energy firms are expected to drill a minimum of 10 wells, eight in deep water and two onshore, the institute added.

The firms earlier won oil tenders as part of Mozambique’s fifth licensing round in 2014.

Heavily-indebted Mozambique is hoping its oil and natural gas resources will help it recover from a debt scandal that saw it cut off from multilateral and foreign donors.

More than $30 billion is expected to be invested in Mozambique’s gas sector to build capacity to produce 20 million tons of liquefied natural gas per year.

Rosneft has been looking for investment opportunities in Africa for several years. In May, the oil giant said it will cooperate with Nigerian oil and gas exploration company Oranto Petroleum to develop 21 oil assets across Africa. The company also has a 30-percent stake in the giant Zohr gas field offshore Egypt in the Mediterranean, as well as some prospects in Mozambique.