Mozambique LNG projects are getting closer to take-off. This is because one of the operator, Total, has received $15 billion in debt finance to develop this project.
Total project cost is $20 billion. Therefore, the debt financing forms a great part of the total investments. It is a step in the right direction.
This is a great signal from the financial institutions. The markets have confidence in the long-term future of LNG in Mozambique.
It is one of the biggest projects financing ever in Mozambique. This project will help bring the massive liquefied natural gas project onstream.
Mozambique Natural Gas Fields
This project includes the development of the Golfinho and Atum natural gas fields in the Offshore Area 1 concession. It will also include the construction of a two-train liquefaction plan with a capacity of 13.1 million tons per year.
As one of the Mozambique LNG projects, the development is taking place in the country’s northernmost province of Cabo Delgado. It follows one of the biggest gas finds in a decade off its coast. Together, the projects are worth some $60 billion.
Mozambique LNG Projects – The Start
This project, operated by Total, started with the discovery of huge quantity of natural gas off the coast of northern Mozambique in 2010.
The discoveries led to a $20 billion final investment decision in 2019. First LNG from this project will come onstream in 2024.
It is on this backdrop that the debt financing announced by Total becomes very key in developing the LNG resources.
The Mozambique LNG Project will deliver a range of social and economic benefits to Mozambique.
Its geographic location positions the project well to meet Atlantic and Asia-Pacific market needs, as well as tap into the growing energy demands of the Middle East and Indian sub-continent.
In the short term, construction of the LNG facilities will provide opportunities for professional training, employment, and contracts for the supply of goods and services. The construction phase also manages environmental and social impacts and reduces risks.
In the medium-to-long term, the Mozambique LNG Project is foundational for diversifying Mozambique’s economic activities.