- Mozambique Mining: Communities paralyze Vale operation on Moatize Ii ACTIVITIES OF MINE II DA VALE IN MOATIZE
- Africa Oil & Gas: Nigerian Gas Tanker Explosion Kills At Least 35
- DR Congo: Exim Bank India Finances DRC Solar
- Zambia: Largest Solar Plant Complete
- Tanzania: Cabinet to Start Talks for $30B LNG Project
Royal Dutch Shell (RDS.A, RDS.B) accuses Anadarko Petroleum (NYSE:APC) of holding it and Mozambique’s government hostage by refusing to supply enough domestic gas in the first phase of a giant liquefied natural gas project.
Shell plans to build a 38K bbl/day gas-to-liquid plant in Mozambique that will produce kerosene, diesel and naphtha, but the project’s director says APC is obstructing its plans by refusing to supply gas until the second phase of the LNG project, which is not expected to start until 2031.
APC’s Mozambique country manager says its consortium eventually would supply 400M cm of gas domestically but could spare only 100M cm in the first phase, expected to begin ~2025, as lenders were unwilling to allow APC to certify additional reserves until production began.
In addition to earning royalties from gas exports, Maputo wants to develop local industry and improve power supply. Only about a quarter of 30m Mozambicans have access to electricity. There are additional plans for a $2bn gas fertiliser plant to be built by Norway’s Yara. Augusto Fernando, deputy minister of mineral resources and energy, said Maputo was urging Anadarko to “try to speed up” supply.
“The Mozambican government would like to get these programmes moving,” he said. Florival Mucave, president of the local content commission at the Mozambican Confederation of Trade Associations, said a delay in domestic gas supply would deprive Mozambique of much benefit.
“We would like to appeal to the international oil companies to look at an inclusive economy,” he said. “We expect them to work with Mozambicans and Mozambican companies to help the Mozambican economy.”
Mozambique is trying to avoid the fate of countries such as Angola and Nigeria, where hydrocarbons have destroyed — rather than developed — large swaths of the economy. It has already made one mis-step, borrowing — and then defaulting — on more than $2bn of loans made on the back of anticipated gas receipts.
The Area 1 consortium led by Anadarko is expected to give final investment approval to the LNG project in the first half of next year. Mr Wilson said the company had already started resettling families and had 3,000 workers on site.
Mozambique officials worry that a delay in domestic gas supply would deprive the local economy of much benefit. source: Seeking Alpha