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    Mozambique President Lays Foundation for LNG Industry

Summary

The ceremony symbolises the start of Mozambique's hoped-for economic turnaround.

by: Thulani Mpofu

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Natural Gas & LNG News, Africa, Liquified Natural Gas (LNG), Premium, Corporate, Exploration & Production, Import/Export, Investments, Political, Infrastructure, News By Country, Mozambique

Mozambique President Lays Foundation for LNG Industry

Mozambique's president, Filipe Nyusi, laid August 5 the foundation stone at the site where the Area 1 consortium will build an onshore liquefied natural gas (LNG) facility in the north of the southern African country.

He also inaugurated two roads linking the project area with the rest of the country and a village where people displaced by the proposed 12.88mn metric tons/yr export complex were resettled. 

"Mozambique is taking giant steps towards generating more sources of revenue that will allow the structuring of our economy in the long term, in the national, regional, continental and global context," Mozambican national news agency, AIM, quoted Nyusi as saying.

"Nothing will be as before. Implementation of this project is part of our strategy of industrialisation expressed in the local transformation of our resources into products of value destined for the national and international markets," he said.

The launch followed the announcement of a final investment decision by the consortium on June 18, 2019 in Maputo, the Mozambican capital. For now, the US independent Anadarko has a 26.5% stake, which it has agreed to sell to Occidental Petroleum, which has in turn sold it on to Total along with all other African assets owned by Andarko. Its shareholders are expected to approve the deal August 8. The other partners are Japanese Mitsui E&P (20%), state ENH Rovuma (15%), Indian ONGC Videsh (10%), local firm Beas Rovuma Energy Mozambique (10%), BPRL Ventures Mozambique BV (10%) and Thai PTTEP Mozambique Area 1 (8.5%).

Anadarko found an estimated 75 trillion ft³ of recoverable natural gas in  Area 1 and the consortium plans to spend about $20bn building infrastructure to extract the gas; two on-shore liquefaction trains; and a domestic supply line. First gas is expected in late 2024 or early 2025, according to previous projections by the consortium.

This will be the country's first onshore LNG development, initially consisting of two trains with total nameplate capacity of 12.88mn mt/yr to support the development of the Golfinho/Atum fields.  By the time it took the final investment decision, the project had secured 11.1mn mt/yr of long-term LNG sales with key LNG buyers in Asia and in Europe, ona range of price indexation formulas including coal, equivalent to 86% of the plant's installed capacity. 

The village has 556 modern houses which are electrified and have piped water.  There is hospital and a police station among other amenities.