BP has agreed to offtake LNG from Eni’s Coral FLNG project in Mozambique, under a contract that offers competitively priced cargoes in return for flex

BP has agreed to offtake LNG from Enis planned 2.5 mtpa FLNG project in Mozambique. Interfax understands that under the deal which is not yet binding the UK oil major has secured the LNG on an oil-linked, free-on-board basis, at prices competitive with cheap exports that will be coming out of the United States.

With oil costing $50 per barrel, the LNG price would work out at $5.5/MMBtu, a source told Interfax. In return the UK major has also agreed to take on a lot of technical risk and will be flexible if LNG volumes from the project are lower or available later than expected.

Eni, which operates Mozambiques Area 4, has yet to select the engineering, procurement, constructio