Energy Capital & Power

Temane Natural Gas Project Reaches $760-Million FID

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The Government of Mozambique and integrated energy and chemical company Sasol reached a Final Investment Decision (FID) last Friday for the development of the Temane Natural Gas Project in Mozambique. Totaling $760 million, the investment is aimed at the development of additional natural gas reservoirs at the Inhassoro and Temane fields in Inhambane Province and will be conducted under a revised Petroleum Sharing Contract signed last September.

The FID will facilitate the production of 23 million GJ of natural gas per year – which can be used to produce 30,000 tons of cooking gas, or liquefied petroleum gas (LPG), per year – as well as the generation of 450 MW of electricity at the Temane Combined Cycle Thermal Power Plant. Additionally, the project will enable the production of 4,000 barrels of light oil per day for export.

The significance of the investment is three-fold. Firstly, the production of 30,000 tons of LPG per year will allow Mozambique to dramatically decrease import volumes – which currently comprise 75% of oil and gas products – boost local LPG production and contribute to the reduction of country-wide deforestation.

Secondly, the development of the gas-to-power plant will increase electricity injection into the country’s national grid, contributing to electrification targets through the provision of a low-cost and efficient supply and facilitating regional development through electricity exports. Lastly, the investment significantly increases natural gas’s in-country value in Mozambique. By fully capitalizing on the resource, Mozambique is transforming its domestic energy sector, accelerating industrialization and spurring economic development.

With construction planned to commence in July 2021, the Temane Natural Gas Project is expected to significantly increase job creation opportunities through the direct employment of more than 3,000 Mozambicans and the generation of thousands of indirect jobs over the next three years.

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Charné Hollands

Charné Hollands

Charné Hollands is the Deputy Editor at Energy Capital & Power. She holds a Higher Certificate in Professional Photography and Masters in Media Studies from the University of Cape Town. Charné writes content for ECP's website and events as well as co-authored African Energy Chamber: Road to Recovery.