Mozambique: Nyusi Lays First Stone for LNG Factory in Palma

Maputo — Palma (Mozambique), 5 Aug (AIM) - Mozambican President Filipe Nyusi on Monday laid the first stone in the construction of a liquefied natural gas (LNG) plant in the Afungi Peninsula, Palma district in the northern province of Cabo Delgado.

Nyusi told the ceremony that this marked the turning of a new page in the country's history, paving the way for Mozambique to become one of the largest producers and exporters of LNG in the world.

Two LNG factories (known as "trains") will be built at Afungi. Nyusi said they will produce 12.6 million tonnes of LNG a year, of which 11.1 million tonnes are already earmarked for sale through medium and long term contracts. Hence the viability of the undertaking is guaranteed.

"Mozambique is taking giant steps towards generating more sources of revenue that will allow the structuring of our economy in the long term, in the national, regional, continental and global context", said Nyusi.

"Nothing will be as before", declared the President.

"Implementation of this project", he continued, "is part of our strategy of industrialisation expressed in the local transformation of our resources into products of value destined for the national and international markets".

The final investment decision for this project was signed on 18 June in Maputo between the government and the consortium exploiting the natural gas resources in offshore area one of the Rovuma Basin, headed by the US company Anadarko Petroleum.

Anadarko holds 26.5 per cent of Area One and is the operator. Its partners in the Consortium are the Japanese company Mitsui (20 per cent), PTTEP of Thailand (8.5 per cent), the three Indian companies ONGC Videsh, Bias Rovuma Energy, and BRPL Ventures (each with ten per cent), and Mozambique's own National Hydrocarbon Company (ENH - 15 per cent).

Anadarko will not be operator for much longer, since the company is being sold to Occidental Petroleum, and the French energy giant Total has agreed to buy all of Anadarko's African assets, including Rovuma Basin Area One from Occidental.

The confirmed reserves of gas in Area One are 76 trillion cubic feet. The total investment envisaged is around 25 billion US dollars. 14 billion dollars will come from bank loans, and 11 billion from the capital of the partners in the Area One Concession. This is far and away the largest investment in the history of Mozambique.

The liquefaction process involves cooling the gas to a temperature of minus 162 degrees Celsius. At this temperature, its volume shrinks to just one six-hundredth of its gaseous state. The LNG will be exported in tanker ships that will dock at special berths to be built at a new port in Palma. There will be five berths, four for LNG and one for condensate. Each of the tanker ships will be 300 metres long and can hold the equivalent of about a million barrels.

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