Breaking News! Currency questions delay Mozambique oil and gas exploration contracts

currency-delays_mozambique
International oil companies planning to explore areas on- and offshore Mozambique are still seeking clarifications from the Mozambican authorities on the rules governing their use of foreign currency, according to a report on Monday 16 January, in Notícias.

The winners of the fifth exploration licensing round, who were announced in October 2015, have been in negotiations with the petroleum regulator INP for months, but cannot start exploration until they sign an Exploration and Production Concession Contract (EPCC) for their individual concessions.

Notícias cites an anonymous source close to the negotiation process, who says some of the contacts could be ready in four or five months’ time, once certain points have been cleared up. Those points, the report says, are dominated by questions around foreign exchange.

In November, Zitamar News reported that oil and gas companies are dissatisfied with current regulations forcing them to change 50% of any foreign currency they bring into Mozambique into Mozambican meticais – even if the money is destined to pay contractors in foreign currency. This and other issues have been addressed for the Area-1 and Area-4 project in the Rovuma Basin, which have been granted special dispensation to use offshore accounts. US oil major ExxonMobil won three offshore areas in the fifth round, in partnership with Russia’s Rosneft. Another offshore area went to Italy’s ENI, whose consortium includes Norway’s Statoil and Sasol of South Africa.

Sasol, bidding alone, also won an onshore area adjacent to its current areas in Inhambane Province, while Londonbased Delonex won an onshore area further south in Maputo Province, in partnership with Indian Oil Corp.

Source: Zitamar News
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