Rovuma Basin: Interview With John Peffer, President, Anadarko Mozambique

Peffer Anadarko is a global leader in the deepwater sector worldwide, especially in the Gulf of Mexico. Some of our geoscientists in Houston had been to Mozambique in the early 1980s, when deepwater operations were not even on the agenda. The deepwater opportunities in Mozambique arose in 2005 with the opening of the Rovuma blocks, and we took advantage of our in-house knowledge to pursue Rovuma acreage. We made a seven-well commitment, as well as 3-D and 2-D seismic surveys, the largest international exploration commitment in Anadarko's history. In summary, I would say the important factor for entering Mozambique was the fact that we had geoscientists who had identified the potential opportunities in Mozambique, and once the deepwater blocks opened, we were quick to gain market entrance.

Is there anything specific in the geology here that makes natural gas exploration attractive?

Peffer When we came to Mozambique we were primarily looking for oil. Historically, East Africa is a natural-gas-rich territory, and that is the reason why it had not been explored more extensively until a few years ago. Although we have always known that the onshore would be natural gas prone, there was and continues to be potential for oil in the deep water. To date, the results of our exploration have been spectacular, and our natural gas discoveries have significantly exceeded our initial expectations. Currently standing at approximately 30 to 60-plus trillion cubic feet (Tcf), this is undoubtedly a discovery of tremendous size that could have a transformative effect on Mozambique's economy.

Anadarko's investments in Mozambique are an important driver for the economy. How do you make sure that the benefits coming from your investments are felt by the local population?

Peffer Since we started our exploration program we have invested more than $1 billion, including several million dollars per year for social, training and institutional development, creating jobs and other economic benefits for the people of Mozambique. Once production begins, we expect the project to provide significant cash flow for the partnership and tax revenue for the government that can be used for the development of the country. We believe that Mozambique has the potential to become the third-largest LNG exporter in the world and reaching this potential means more training, more jobs and more industry-specific experience for the local people.

Does the fact that you are working offshore diminish the benefits available to the Mozambican people?

Because we are developing these resources via LNG, we expect Mozambique will experience significant benefits that come with any onshore project: employment possibilities, investments in new airports, roads, ports, and communication infrastructure.