By ALEXIS FLYNN
LONDON -- Mozambique is in talks with Royal Dutch Shell
about the oil giant developing the country's natural-gas
resources, including a possible liquefied-natural-gas project, President Emilio Guebuza
Shell, which last month had a $1.8 billion bid for
Mozambique-focused gas producer Cove Energy recommended by the
firm's board, may choose to use the access to one of East
Africa's most promising natural-gas provinces to develop giant
"We are working with Shell," said President Guebuza. "It's
true. We believe what they are saying."
President Guebuza said his country would seek to "negotiate
a participation in mega-projects" like an LNG plant, but he
stressed that this was in the interest of developing local
skills and initiative and using any revenues to progress the
country's social agenda.
"We want them [companies investing in the country's
resources] to develop profits for shareholders. But above all,
we want to ensure these benefits help all the people of
Mozambique," said President Guebuza.
Shell upped its bid for Cove, a junior partner in the
potentially huge Rovuma gas field, on April 24.
Although Shell's 220 pence a share bid only matched an
earlier offer by Thai-stated owned PTT Exploration &
Production, Cove's board recommended Shell's offer to its
shareholders, arguing that the Anglo-Dutch major's expertise in
gas exploration, production and most critically, exports, set
it apart from its rival suitors.
Interest in Cove, a modestly-sized exploration company
listed on London's junior exchange, has been fueled by its 8.5%
stake in Rovuma, owned and operated by Anadarko Petroleum.
Shell's offer has been hailed by analysts as a logical step for
the world's biggest shipper of liquefied natural gas.
With an estimated 30 trillion cubic feet contained in the
Rovuma field, and nearby finds by Italy's Eni
potentially holding twice that amount, there could be enough
gas to justify the construction of an LNG facility to
supply high-demand Asian markets.
Shell announced later Wednesday that it has received the
consent of Mozambique's Minister of Natural Resources for the
Speaking at an event at British think-tank Chatam House,
Guebuza said his government aimed to harness the proceeds of
Mozambique's hydrocarbon and mineral resources. The
country has only recently started to emerge from the shadow of
a devastating civil war that ended in 1992.
Although growth averaged 7.2% last year, more than half the
population still lives in poverty, according to the CIA
"International partners are welcome to join us in this
journey so we can one day celebrate the end of poverty," he
said. "Our vision is to turn our mineral resources into a
driving force for social transformation."
Dow Jones Newswires