Zacks_Analysts' Blog : Anadarko Finds Gas off Mozambique - Analyst Blog

Anadarko Petroleum Corporation (APC) has discovered more than 230 net feet (70 meters) of natural gas at its Barquentine-2 appraisal well, located in Mozambique's Offshore Area 1 of the Rovuma Basin.  The well discovered natural gas in the high-quality Oligocene-age reservoirs.

Located about 2 miles east-southeast of the Barquentine-1 discovery well, the Barquentine-2 appraisal well was drilled to a total depth of nearly 13,500 feet (4,100 meters) in water depths of about 5,400 feet (1,650 meters).

Barquentine-2 is the first appraisal well in the Windjammer, Barquentine and Lagosta complex. The company estimates net recoverable natural gas resources in this complex to be a minimum of 6 trillion cubic feet (Tcf).

Anadarko has now mobilized the drillship to the south to drill the Camarao exploration well, which will also serve as an appraisal for the Windjammer discovery.

Furthermore, Anadarko continues to work towards the development of these substantial resources by awarding contracts for pre-FEED (front-end engineering and design) work for a prospective LNG (liquefied natural gas) plant. As part of this initiative, Anadarko and co-owners have awarded contracts to KBR and Technip to perform pre-FEED studies for an LNG plant in Mozambique.

The pre-FEED studies are designed to help the partnership further assess the viability of developing an LNG facility to produce and process natural gas from the region.

Anadarko has significant ongoing exploration and appraisal programs in the Rovuma Basin. Anadarko, the operator of the 2.6-million-acre Offshore Area 1, has a 36.5% working interest in the field.

Co-owners include Mitsui E&P Mozambique Area 1 Limited (20% interest), BPRL Ventures Mozambique B.V. (10%), Videocon Mozambique Rovuma 1 Limited (10%) and Cove Energy Mozambique Rovuma Offshore Ltd. (8.5%). Empresa Nacional de Hidrocarbonetos E.P. has a 15% interest, which is carried through the exploration phase.

Based in The Woodlands, Texas, Anadarko Petroleum is primarily engaged in the exploration, development, production, gathering, processing and marketing of natural gas, crude oil, condensate and NGLs. The company primarily competes with ConocoPhillips (COP) and Exxon Mobil Corp. (XOM).

Anadarko currently has a Zacks #3 Rank (short term Hold rating). We maintain our long term ‘Neutral’ recommendation on the stock.