Mozambique’s Competition Regulatory Authority (ARC) has initiated a public consultation regarding Portugal’s Galp Energia’s planned sale of its stake in the Rovuma Basin natural gas consortium to the Abu Dhabi National Oil Company (ADNOC) group, based in the United Arab Emirates.
In a notice published on Monday, the ARC announced that it received a “notification of a concentration of companies” on May 27, effective from May 30. This notification pertains to a deal valued at €600 million by Galp.
The deal involves ADNOC International, a wholly-owned subsidiary of ADNOC, acquiring “exclusive control over Galp Energia Rovuma,” currently owned by Galp Energia, Portugal Holdings, and Galp East Africa. These entities are “jointly the sellers” in this transaction.
The competition regulator’s notice explains that ADNOC International, based in Abu Dhabi, is part of a diversified group entirely owned by the Emirate of Abu Dhabi.
ADNOC operates throughout the hydrocarbon value chain through a network of fully integrated companies.
“Any comments on the merger in question should be sent to the Competition Regulatory Authority within 15 days,” the notice states.
On May 23, Mozambique’s National Petroleum Institute (INP) stated that it viewed Galp’s withdrawal from the Rovuma natural gas consortium as a normal procedure, noting that the company had not yet formally communicated its decision to the authorities.
“It’s not something extraordinary,” said INP president Nazário Bangalane. “Concessionaires are free to negotiate directly or indirectly about their stakes in consortia. In the meetings we’ve had with Galp, there has been this intention. However, it has procedures. The Portuguese company will officially submit the process to be analyzed at government level, and then we will know the real amounts involved in the operation.”
Galp reached an agreement with ADNOC to sell its position in the Rovuma Basin consortium for almost €600 million. In a statement to Portugal’s Securities Markets Commission (CMVM), Galp announced its intention to sell its 10% stake in Area 4 in Mozambique, with the transaction expected to be finalized by the end of the year, aligning with its “disciplined” investment strategy.
“Area 4 includes Coral South FLNG, which has been operating since 2022, as well as onshore developments in the prospective Coral North FLNG and Rovuma LNG, both of which are expected to be approved in 2024/2025,” the statement reads.
Galp is set to receive $650 million (€599 million) for the shares and shareholder loans, net of capital gains taxes.
The agreement also includes “additional contingent payments of $100 million (€92 million) and $400 million (€369 million) upon the final investment decision of Coral North and Rovuma LNG, respectively.”
Area 4 is operated by Mozambique Rovuma Venture (MRV), a joint venture between ExxonMobil, Eni, and CNPC that holds a 70% stake in the concession contract.
Galp, Kogas of South Korea, and Mozambique’s state-owned Empresa Nacional de Hidrocarbonetos (ENH) each hold a 10% stake.
