Mozambique LNG project

 

 

With a second final investment decision (FID) in just two years, Mozambique has officially positioned itself as a key player in the global gas and LNG market for years to come. The latest FID on the US$20 billion Mozambique LNG project, makes it the largest sanction ever in sub-Saharan Africa oil and gas.

Described by President Nyusi as “one of the most important and transformational projects in the country’s history”, Mozambique LNG is set to be a game-changer for this East African nation of 31 million people.

The president added: “This is a historic day for the people of Mozambique. Today’s sanctioning of the Anadarko-led Area 1 Mozambique LNG project solidifies a path toward the creation of thousands of jobs for our people, significant economic growth for our nation, and the potential to be one of the world’s largest providers of cleaner energy for decades to come. It is truly one of the most important and transformational projects in our country’s history.”

Anadarko’s Chairman and CEO, Al Walker, said: “This is an exciting day for Mozambique and for our partnership, bringing us a step closer to making Mozambique’s first onshore LNG facility a reality. The Anadarko-led Area 1 Mozambique LNG project has come a long way from our first discovery to FID for the construction of the initial two-train development project. I want to say a collective ‘thank you’ to the world-class LNG team we have assembled at Anadarko, our co-venturers, long-term foundation customers, lenders, the people of the Cabo Delgado region, and the Government of Mozambique.

As the world increasingly seeks cleaner forms of energy, the Anadarko-led Area 1 Mozambique LNG project is ideally located to meet growing demand, particularly in expanding Asian and European markets. We look forward to safely executing the next phase of this project for the long-term benefit of Mozambique, its people, our partnership, and our customers.”

According to Wood Mac, from the early 2030s state revenue from Mozambique LNG alone will reach US$3 billion per annum, single-handedly doubling today’s revenue as calculated by the IMF and World Bank.

And this is not the only mega-LNG project on the drawing board. ExxonMobil’s Rovuma LNG project, which envisages a 15 million tons per annum (tpa) two-train facility taking gas from its offshore area 4 block, is also lined up to take FID.

Meanwhile, Italy’s ENI is already moving ahead with its 3.4 million tpa floating LNG facility, which will draw on 5 TCF of gas in waters more than 2,000 metres deep with first gas due in mid-2022.

“With strong LNG demand growth out of Asia, now is Mozambique’s time,” said Jon Lawrence, an analyst with Wood Mackenzie’s sub-Saharan Africa upstream team, as news broke of the Anadarko FID.

With FIDs signed, the projects are now moving from the planning into the implementation phase. Hundreds of contracts are expected to be tendered for the construction, infrastructure and services needed to build and develop the megaprojects.

More recently, on October 8th, Mozambique Rovuma Venture (MRV) Area 4 operator decided to move ahead with the midstream and upstream project activities of over US $500 million as initial investments. These investments include activities such as the construction of the pioneer camp, the development of resettlement activities, the construction of the airstrip and access roads, as well as the start of detailed LNG facility engineering project.