ONGC Videsh Ltd (OVL) is making progress on its offshore gas exploration project in Mozambique, where on-ground activities have resumed, officials confirmed.
The OVL board recently approved an investment of ₹1,500 crore into the joint venture (JV) there.
OVL, the international arm of India’s state-owned Oil and Natural Gas Corporation (ONGC), holds a 10% stake in the $20 billion “Offshore Area 1” LNG project.
The project has been under force majeure since April 2021 due to attacks by Islamic State militants in northern Mozambique’s Cabo Delgado province. However, officials expect the force majeure to be lifted soon.
The board approved an investment of up to ₹1,500 crore in Beas Rovuma Energy Mozambique Limited (BREML), an OVL subsidiary in which it owns a 60% stake, with the remaining 40% held by Oil India Limited (OIL).
Additionally, OVL approved related-party transactions, including a senior loan of up to $379.3 million from OVL Overseas IFSC Ltd (OOIL) to Moz LNG1 Financing Company Ltd (MozLNG1) for the Mozambique Area 1 project. OOIL, a wholly owned subsidiary of OVL, will also provide guarantee support for the loan, according to regulatory filings.
The Mozambique Rovuma Area 1 Offshore project spans 2.6 million acres and is expected to develop integrated gas fields with an estimated 75 trillion cubic feet of recoverable natural gas.
Given its proximity to India, the project is a strategic investment, ensuring a relatively straightforward LNG supply route across the Indian Ocean.
OVL directly holds a 10% stake in the project, with an additional 6% held through its 60% shareholding in BREML. The project is situated in the Rovuma Basin, about 40 km offshore northern Mozambique.
Another Indian entity, BPRL Ventures Mozambique BV—an overseas subsidiary of Bharat Petro Resources Ltd (BPRL), a wholly owned subsidiary of BPCL—holds a 10% stake, while OIL holds 4%.
The project is being developed by a consortium led by French energy major Total SE (26.5%), along with Mozambique’s national oil company Empresa Nacional de Hidrocarbonetos (ENH) (15%), Mitsui E&P Mozambique Area 1 (20%), and PTTEP Mozambique Area 1 (8.5%), a subsidiary of Thailand’s national exploration and production company.
The combined Indian stake, held by OVL, BREML, and BPRL Ventures Mozambique, accounts for 30% of the project.
