Italian energy major Eni SpA (E) has added another 4 trillion cubic feet (Tcf) of gas in place within the Mamba Complex, in Area 4, offshore Mozambique.
The Coral 3 delineation well represents the eighth well drilled back-to-back in Area 4 and substantiates the potential of Eni-operated Area 4 at 75 Tcf of gas in place, of which 27 Tcf is located completely in Area 4.
Located about 5 kilometers south of Coral 1, 15 kilometers from Coral 2 and about 65 kilometers off the Cabo Delgado coast – Coral 3 was drilled in 2,035 meters of water and touches a total depth of 5,270 meters, where it came across117 meters of gas pay in a high quality Eocene reservoir.
In addition to verifying the huge prospects of the Coral discovery (estimated to hold more than 13 Tcf of gas in place), the discovery also proved the existence of hydraulic communication in the same reservoirs of Coral 1 and Coral 2.
The Italian outfit has proposed to drill another delineation well – Mamba South 3 – to evaluate the full potential of the Mamba Complex discoveries, prior to moving back to exploration drilling in the southern sector of Area 4.
Eni, the operator of Area 4, holds a 70% participating interest, while the other partners –Galp Energia of Portugal, Kogas of South Korea and Mozambique state oil company ENH – hold 10% each.
The latest discovery strengthens Eni’s position in the area and the company intends to make steady progress with the development plans for this huge gas reserve base. The final investment decision for development of its gas reserves is expected by 2014.
Recently, Eni entered into a Heads of Agreement with US-based Anadarko Petroleum Corporation (APC) for the development of natural gas reservoirs offshore Mozambique. But given the size of the discoveries in the area, both the companies are ready to farm out their interests to additional partners.
Eni holds a Zacks Rank #4, which is equivalent to a short-term Sell rating. However, there are other stocks in the oil and gas sector – NGL Energy Partners LP (NGL) and Laclede Group Inc (LG) – which hold a Zacks Rank #1 (Strong Buy) and are expected to perform better.
More From Zacks.com