Independent oil and gas producer Anadarko Petroleum Corporation’s (APC) latest discovery off the coast of Mozambique has substantially raised the total reserve of natural gas in the field located in the Offshore Area 1 of Mozambique's Rovuma Basin at the Lagosta prospect.
Initial finding from this field, a year ago, suggested an estimated reserve of about 6 trillion cubic feet (Tcf) of natural gas but the new find has lifted the estimated recoverable resource to a range of 15–30 Tcf of natural gas, with total estimated reserve at 30–50 Tcf of natural gas.
The exploration well Barquentine-3, drilled at a total depth of approximately 13,400 feet, (4,084 meters), encountered about 5,170 feet (1,575 meters) of water. The partnership is mobilizing new drilliship in the area to spur exploration activity.
Anadarko is working jointly with five other players in the Offshore Area 1 of Mozambique and has a 36.5% working interest. Other players have working interest in the field ranging from 8.5% (Cove Energy Mozambique Rovuma Offshore Ltd.) to 20% (Mitsui E&P Mozambique Area 1, Limited).
Global demand for natural gas is on the rise due to its clean burning nature and the company is working to capitalize on this new wave. This new find will come into commercial operation from 2018 and the company has plans to send the same to meet energy demand from China and Japan.
Anadarko has been working to expand its operations in Africa through the development of the Ghana Jubilee Field and a few other Algerian projects. The drilling success in other fields has inspired the company look for more opportunities in Sierra Leone, Liberia, Ghana and Mozambique.
This new find in Mozambique has been tagged as the largest find of natural gas for the company. As per Energy Information Administration (“EIA”) natural gas-fired electricity generation is expected to account for 80% of all added electricity generation capacity by 2035.
In such a scenario we believe the new finding is quite significant for Anadarko when more and more utility operators are starting to depend on natural gas as an energy source. We believe the use of natural gas will enable operators to fulfill government regulation and avoid coal, a major environment pollutant, and nuclear power, another high risk source, for energy generation.
A significant development for Anadarko in recent months has been its settlement with BP plc. (BP) for all current and future claims associated with the Deepwater Horizon accident. This deal has removed the uncertainty over Anadarko’s liability in the clean-up of the Macondo oil spill. Anadarko currently retains a Zacks #3 Rank (short-term Hold rating).
Based in Texas, Anadarko Petroleum is an independent oil and gas company engaged in the acquisition, exploration, and production of oil and gas primarily in the United States, the deepwater Gulf of Mexico, and Algeria.
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