Mozambique set to  export first LNG Both Mozambique and Tanzania stand to benefit from the dash for gas

Mozambique is finally joining the ranks of liquefied natural gas (LNG) exporting countries, with the first shipments from ENI’s Coral-Sul 3.4m tonnes/year (t/y) floating LNG project due imminently. 

But any celebrations over that landmark will be tempered by continuing uncertainties over the future of much larger onshore LNG projects, whose development have been disrupted by violent unrest.

Coral-Sul, located safely offshore with its production facility brought in pre-built from South Korea, was supposed to be the low-risk precursor to two more ambitious onshore projects planned for the Afungi peninsula in northern Mozambique. 

The region is adjacent to the country’s substantial offshore gas reserves, which are estimated at some 100 trillion cubic feet, the third largest in Africa after Nigeria and Algeria.

Security situation holds back progress

The revenues and jobs these provide could transform the economy of Mozambique, one of the world’s poorest countries. But little progress has been made on construction of the TotalEnergies-led Mozambique LNG (MLNG) plant and the proposed ExxonMobil-led Rovuma LNG (RLNG) plant that would neighbour it, since attacks by Islamist insurgents on site workers and others in the region caused construction to be halted in early 2021.

TotalEnergies withdrew all its staff from the region in April 2021, when it declared force majeure on its 12.8m t/y project. ExxonMobil has yet to take a final                              investment decision on its project, which was conceived as a two-production train 15.2m t/y facility.

TotalEnergies’ CEO, Patrick Pouyanné, said in January that the company’s objective was to restart work on its $20bn project in 2022, but he also said this wouldn’t happen until life in the region was “back to normality”.  Although an international effort to quell the insurgency, led by Rwandan forces, has reduced the level of unrest, there is little indication that the international companies plan to return imminently.

Arun Kumar Singh, the head of India’s Bharat Petroleum, which holds a 10 percent stake in MLNG, told his company’s annual general meeting in August that he was hopeful work would resume on the export plant in the first half of 2023, but also said any resumption was dependent on a sustained stabilisation of the security situation.  – African Business

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