October 4, 2016 / 12:23 PM / a year ago

Mozambique, Eni sign 20-year LNG sales agreement with BP

The logo of BP is on display at a petrol station in Moscow, Russia, July 4, 2016. REUTERS/Sergei Karpukhi/File photo

MAPUTO (Reuters) - Mozambique and Italy’s Eni (ENI.MI) have signed a 20-year deal to sell BP (BP.L) liquefied natural gas (LNG), an important step in getting a long-delayed project off the ground, state energy firm ENH said on Tuesday.

Eni and Mozambique should by the end of this year reach a final investment decision on a project to build a floating offshore platform with a capacity to produce 3.3 million tonnes a year of LNG from gas in the Coral South field, ENH said.

The Coral field is part of the huge reserves discovered six years ago in the Area 4 concession off the Mozambican coast.

“Through this agreement, the partners of Area 4 have achieved another important milestone,” ENH said in a statement.

Eni met with bankers in London last month about project financing to develop the Coral field. [nL8N1C31U4]

Giant gas reserves offer Mozambique an opportunity to transform itself from one of the world’s poorest countries into a middle-income state and a major global LNG exporter.

Reporting by Manuel Mucari; Writing by Olivia Kumwenda-Mtambo; Editing by Joe Brock

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