Mozambique Oil & Gas: Is this the LNG year for Mozambique?

Financial scandal and security issues are the latest challenges to be overcome in Mozambique’s long-delayed emergence into the world of LNG. However, a raft of off-take agreements for two major projects in the country’s north should make 2019 a pivotal year as investors move towards final investment decisions. These projects would represent Mozambique’s biggest foreign direct investments to date.

Mozambique looks set to become an important LNG exporter, as two large onshore projects move towards final investment decisions (FID) this year.

Following years of delay, a succession of off-take agreements have been signed in recent months to support 28 million metric tons a year of LNG capacity planned for northern Mozambique. FIDs on the onshore Mozambique LNG and Rovuma LNG projects are expected to be taken by the middle of this year, allowing the developers to convert all non-binding deals into sales and purchase agreements (SPAs) by December.

The two projects are to be developed by consortia operated by US company Anadarko and Italy’s Eni respectively on a joint site at Afungi in the far north of the country.

The government of Mozambique decided at an early stage that it wanted the two consortia to develop their liquefaction capacity at a single location to facilitate licensing and reduce infrastructural investment costs. It also means that they can use the same export terminal. Another, smaller scheme, the Coral Sul floating LNG (FLNG) project – also operated by Eni – is already under development.source: NGW