Exxon Mobil in Talks to Buy Stake in Big Mozambique Gas Project From Eni SpA
24 Mars 2016 - 10:59PM
Dow Jones News
By Bradley Olson, Dana Mattioli and Shayndi Raice
Exxon Mobil Corp. is in advanced talks to acquire a stake in a
giant Mozambique natural gas development project from Italy's Eni
SpA, a sign that major oil companies are again hunting for deals
after energy prices crashed in 2014.
The acquisition could be announced in coming weeks, according to
people familiar with the matter. Terms of the deal aren't clear,
but one person indicated Exxon is in talks to buy a stake of around
20% from Eni, which owns 50% of the development.
As with all discussions over deals, timing could slip, talks
could fall apart at the last minute or the size of the stake could
change.
Any such purchase likely would be a drop in the bucket for
Exxon, which has a market value of around $350 billion. A 20% stake
in the field sold for more than $4 billion in 2013, before energy
prices tumbled.
The Mozambique Area 4 offshore development is expected to become
a major global supplier of liquefied natural gas. Eni has estimated
it may hold enough gas to meet U.S. residential consumption for
nearly two decades.
For Exxon, the assets represent an important move toward finding
new oil and gas reserves, a step many analysts have estimated it
would take as prices fell. Last year, the Irving, Texas-based
company was only able to replace about two-thirds of the oil and
natural gas it produced, the first time that has happened in 22
years.
--Eric Sylvers contributed to this article.
(END) Dow Jones Newswires
March 24, 2016 17:44 ET (21:44 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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