While natural gas development in Mozambique targets increased access to power to access, intra-African liquid natural gas (LNG) exports, and job creation for the Southern African country, it has also served as a hotspot for global capital. This week, the Export-Import Bank of the U.S. (EXIM) initiated the process of providing $4.7 billion in financing to Total’s Mozambique LNG project located on the Afungi Peninsula in northern Mozambique. The loan aims to support U.S. exports for the development and construction of the LNG project, which will create an estimated 16,700 American jobs over its five-year construction period. As a result, EXIM represents the largest share of the $15 billion secured in senior debt financing for the project, as the U.S. continues to compete with China and other global players for the top source of investment in African energy infrastructure. The LNG project also received direct and covered loans from eight export credit agencies, 19 commercial bank facilities and a $400 million loan from the African Development Bank. In addition to the U.S., the project has received funds from Japan, the U.K., Italy, the Netherlands, South Africa, and Vietnam.
Offshore Area 1, Rovuma Basin
With a total post-FID investment of $20 billion and $14.9 in project financing, Mozambique LNG represents the largest foreign direct investment in Africa to date, and a landmark development for the continent in terms of domestic LNG use and export. Following FID in June 2019, Total acquired Anadarko’s 26.5% stake in the project in September 2019 and is currently leading the project in conjunction with Mitsui & Co, ONGC, ENH, Bharat PetroResources, PTTEP, and Oil India Ltd. The 13 million-ton onshore LNG facility will include two trains with the respective capacity of 6.44 million tons per year, two LNG storage tanks with the respective capacity of 180,000 cubic meters, condensate storage and a multi-berth marine jetty. Natural gas feedstock will primarily be derived from the Total-operated Prosperidade and Golfinho-Atum Complexes in Area 1, which span 2.6 million acres in the deep-water Rovuma Basin.
The Prosperidade Complex is estimated to hold recoverable resources between 17 and 30 trillion cubic feet (Tcf) of natural gas. Development will include the installation of up to 60 subsea production wells fed into Afungi’s two-train liquefaction plant, as well as installation of three gas export pipelines, one service line, and two mono-ethylene glycol lines. Total has estimated that the Complex will produce two billion cubic feet of natural gas per day. Meanwhile, the Golfinho-Atum Complex holds around 31.9 Tcf of natural gas resources, which will also feed the Afungi LNG plant. Development of the Golfinho-Atum Complex will consist of 20 subsea wells with horizontal trees distributed among 10 manifolds and is also expected to produce two billion cubic feet (Bcf) per day.
Offshore Area 4, Rovuma Basin
The Rovuma LNG Liquefaction Plant, the country’s other large-scale, capital-intensive natural gas project, will utilize gas resources from the Mamba Complex in Area 4 and the Coral South project. Development includes two liquefaction trains with the respective capacity of 7.6 million tons per year, a multi-purpose dock, and an LNG export jetty with two marine loading berths to accommodate LNG carriers. Although ExxonMobil delayed its final investment decision due to COVID-19, the decision is expected next year and production is still expected to begin in 2024/25, producing 15-16 million tons of LNG per year.
ExxonMobil-operated Area 4, developed by Mozambique Rovuma Venture (ExxonMobil, Eni, China National Petroleum Corporation), contains Coral-1 and Coral-2 discoveries that are estimated to carry over 15 Tcf of natural gas combined. Area 4 is also home to the Agulha discovery, which preliminary studies suggest may hold five to seven Tcf of gas. The development of the Coral field employs the use of an FLNG vessel, along with the installation of a subsea system that includes six subsea wells. Start-up is estimated for 2022.
Area 4 also contains the Mamba Complex, which consists of the Mamba North, Mamba Northeast, and Mamba South fields and is being developed by the Mozambique Rovuma Venture (70%), Galp Energia (10%), KOGAS (10%) and ENH (10%). In conjunction with the Coral field development, the Area 4 block is estimated to contain 85 Tcf of gas. Notably, the gas located within Area 4 is dry, which limits flow assurance and liquids output. Initial exploration of the Mamba development will include 21 subsea wells fed to LNG trains via four flowlines and is expected to produce 100 million cubic feet per day, with a start-up set for 2024.
The third major gas development in the country is the Coral FLNG project, which will construct a 3.4 mtpa FLNG vessel to service the Coral Gas field in Area 4. The vessel will be comprised of a turret moored double-hull ship with gas receiving, processing, liquefaction, and offloading facilities, along with LNG and condensate storage totaling over 230,000 and 50,000 cubic meters, respectively. The ultra deep-water development is being led by Eni, and construction commenced in September 2018.
