London-based Cove Energy has put itself up for sale. Cove has an 8.5% stake in a natural gas play off the coast of Mozambique. Analysts hypothesize that one of many Asian gas buyers will make a bid for the company.
A closer look
An 8.5% stake doesn't seem like much, until you realize that it's a percentage of one of the biggest offshore natural gas finds in the last 10 years.
The Rovuma Area 1 offshore block was discovered by Anadarko Petroleum
Cove Energy is expected to sell for more than $1 billion. Anadarko, for that matter, may also be in the market to sell a stake in its Mozambique assets to offset the burden of its $4 billion payment to BP for its role in the Macondo well blowout in the Gulf of Mexico in 2010.
So, who wants Cove's gas? One upside to picking up these assets is that Anadarko is also planning an LNG export facility in the area, something that has appealed to Asian gas buyers in the past. China's Sinopec
Tokyo Gas and Korea Gas may also be in the mix. Japan and South Korea are the world's two largest natural gas importers, though China is eventually expected to overtake them.
Indeed, it is the Chinese companies that have been particularly active of late. PetroChina
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