Eni closes Nigerian onshore chapter and hits LNG production milestone offshore Mozambique

After firmly shutting the door leading to onshore oil and gas plays in Nigeria through asset divestment, Italy’s energy giant Eni will remain in the African country’s hydrocarbon game, pursuing deepwater and liquefied natural gas (LNG) opportunities. In another African country, the company disclosed a new feat accomplished by its floating LNG (FLNG) unit, which reached 5 million tons of LNG production off the coast of Mozambique.

Shortly after receiving all regulatory approvals for the sale of Nigerian Agip Oil Company Ltd (NAOC), its wholly-owned subsidiary focused on onshore oil and gas exploration and production and power generation in Nigeria, Eni confirmed that it had parted ways with NAOC, which has been acquired by Oando, Nigeria’s indigenous energy solutions provider listed on both the Nigerian Exchange Limited and Johannesburg Stock Exchange.

In line with the Italian oil major’s strategy focused on the rationalization of the upstream activities by rebalancing its portfolio and divesting non-strategic assets, the 5% participating interest in Shell Production Development Company Joint Venture (SPDC) is not included in the divestment process, as it will be retained in the firm’s portfolio.

However, the list of partners in SPDC JV – currently operated by Shell (30%), with TotalEnergies (10%), NAOC (5%), and NNPC (55%) as partners – is set to change further soon, since TotalEnergies recently made a move to offload interests in the JV seven months after Shell disclosed arrangements to do the same, with a net book value of around $2.8 billion.

Eni will continue to be present in Nigeria through investment in deepwater projects and Nigeria LNG, while also exploring new opportunities related to the agri-feedstock sector, consistent with the firm’s 2023-2026 plan.

Meanwhile, the Coral Sul FLNG has reached 5 million tons of LNG production, which Eni, as the delegated operator of Area 4, on behalf of its partners ExxonMobil, CNPC, GALP, KOGAS, and ENH, sees as “a significant milestone for the project,” located in the ultra-deep waters of the Rovuma Basin, offshore Mozambique.

For the oil major, this represents “a major technical and operational accomplishment,” standing as “a testament to the dedication, commitment, and collaboration of all the team and stakeholders.” Since the Coral Sul FLNG started production in October 2022, Eni claims that 70 LNG cargos and 10 of condensate have been completed, contributing to the country’s economic growth.

According to the Italian giant, Coral South is “a landmark project” for the industry, placing Mozambique among the global LNG-producing countries, laying the foundation for a transformational change in the African country through the development of gas resources, while also supporting a just and sustainable energy transition.

Marica Calabrese, Eni’s Rovuma Basin Managing Director, underlined: “This accomplishment reinforces our commitment to delivering outstanding value to the country of Mozambique. We will continue to work with our partners and the Government of Mozambique to ensure a timely valorization of Mozambique’s vast gas resources with additional developments of gas projects. As we celebrate, we recognize the importance of remaining focused on safety, environment, and operational excellence.”

With a gas liquefaction capacity of 3.4 million tons per year (mtpa), Coral-Sul FLNG, which is envisioned to put into production 450 billion cubic meters of gas from the giant Coral reservoir in offshore Rovuma Basin, is said to be the first floating LNG facility ever deployed in the deep waters of the African continent.

The proposed Coral North development is expected to produce a further 3.5 mtpa of LNG through an FLNG facility to process and liquefy natural gas for export. The UAE’s ADNOC recently struck a deal with Portugal’s Galp to acquire the latter’s upstream assets in Mozambique, including a stake in Eni’s Coral Sul FLNG.

Eni is actively participating in other African countries’s oil and gas ecosystems, including Cote d’Ivoire, where its recently converted FPSO and FSO are expected to move soon to work on the company’s oil and gas development, which is said to be the largest discovery in the country and the first net-zero Scope 1 and 2 emissions upstream project on the African continent.

Congo made its way to the LNG exporters’ club in February 2024, after the Italian energy titan’s first FLNG unit, known as Tango with 0.6 million tons per annum (mtpa) capacity, began its LNG deliveries. With a capacity of 2.4 mtpa, the second unit, currently under construction, is slated to be in operation by the end of 2025.

Europe is also one of Eni’s active playgrounds, as hammered home by the start of production from a gas project at an offshore field in the Strait of Sicily, which the firm described as Italy’s most important gas development.