On May 24, CNOOC Limited announced that its wholly owned subsidiaries have entered into petroleum exploration and production concession contracts (EPCCs) with the Ministry of Mineral Resources and Energy of Mozambique (MIREME) and Empresa Nacional de Hidrocarbonetos (ENH) for 5 offshore blocks in Mozambique.

CNOOC secured all five blocks it pursued in the sixth public tender, launched in November 2021 to boost awareness of the geological potential of the country’s sedimentary basins. The five blocks comprise around 29,000 square kilometres, split between the three Angoche basin blocks off the coast of northern Nampula Province and the two Save basin blocks off the southern province of Inhambane. Water depths in the sedimentary basins vary from 500 to 2,500 metres.

According to the terms of the contracts, the first stage of the exploration period of the blocks shall be four years. The 5 wholly owned subsidiaries of CNOOC Limited shall act as the operators in the exploration and development phases and independently owns the operating interests in the five blocks (S6-A 70%, S6-B 77.5%, A6-D 77.5%, A6-E 80%, A6-G 79.5%). ENH owns the remaining non-operating interests (S6-A 30%, S6-B 22.5%, A6-D 22.5%, A6-E 20%, A6-G 20.5%).

“After the successive inspection of the contracts”, said Carlos Zacarias, Mozambican minister of mineral resources and energy, “CNOOC will be able to carry out the necessary oil operations and carry out the research and work program that includes seismic acquisition and drilling of boreholes and deep waters, which could lead to discoveries of more oil resources.”

However, “nothing has yet been discovered,” cautioned Nazario Balangane, board chair of the National Petroleum Institute (INP). “If there are no discoveries, obviously the contracts end. But if there are discoveries, we move on to another phase, in which the size of the field is assessed. And when production begins, if there are gains, then that is when the production sharing model begins”.

Zacarias is optimistic based on preliminary studies of both basins. “Gauging the commercial quantities of the existing resources will depend on the quality of the complementary surveys that CNOOC will carry out,” he said.