ONGC to buy stake in Anadarko Mozambique gas block for $2.64 billion

Last Updated: Mon, Aug 26, 2013 04:22 hrs

Anadarko Petroleum Corp said it agreed to sell a 10 percent stake in a gas field offshore Mozambique to a unit of Oil & Natural Gas Corp for $2.64 billion in cash, as the U.S. oil company looks to focus more on its domestic assets.

The deal for Mozambique's offshore Area 1 is expected to close around the end of this year, Anadarko said.

ONGC faces diminishing supplies from its aging oil and gas fields in India and has been buying interests in overseas assets.

ONGC Videsh, the Indian company's overseas arm, recently paid $2.48 billion for a 10 percent stake in another Mozambique gas field from Videocon Group.

Anadarko also said it will remain the operator of Area 1 with a working interest of 26.5 percent in the block, which is located in Mozambique's deepwater Rovuma Basin.

The Rovuma field has the potential to become one of the world's largest liquefied natural gas (LNG) producing hubs by 2018, and is strategically located to supply gas to India at competitive prices.

Recent discoveries have turned the Rovuma offshore field into a major draw for global energy producers and boosted Mozambique's natural gas reserves to around 150 trillion cubic feet, or enough to supply the world's No. 1 LNG importer - Japan - for 35 years.

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