Page 7 - GLNG Week 33 2021
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Recapture of Mocimboa da Praia prompts speculation about Mozambique LNG project
POLICY
SPECULATION about a restart of the Mozam- bique LNG project has begun to rise over the last week, since Mozambican and Rwandan troops regained control of Mocimboa da Praia, a port in the Cabo Delgado province.
Mozambique’s government had retreated from Mocimboa da Praia in August 2020, when the port was seized by Ahlu Sunnah Wa-Jamo (ASWJ), the Islamist group that has been trying to take over Cabo Delgado. That event caused problems for TotalEnergies (France), the leader of the Mozambique LNG project, since the port had been serving as the main point of entry for deliveries of equip- ment, parts and supplies to the site on the Afungi Peninsula where the consortium was building a gas liquefaction plant.
TotalEnergies and its partners did manage to overcome this setback by shifting deliveries to a different port and working with Mozambican authorities to establish a security zone to protect the construction site. However, this solution did not last long. Mozambique’s armed forces were unable to prevent ASWJ from mounting addi- tional attacks in Cabo Delgado, and the fighting eventually came so close to the site of the LNG plant that the French company declared force majeure. In late April, it suspended all work on the Mozambique LNG project pending signifi- cant improvement in security conditions.
Since then, Mozambique’s government has partnered with Rwanda to mount a military campaign against ASWJ. That campaign led to the recapture of the port of Mocimboa da Praia and parts of the Palma district, home to Mozambique LNG’s gas liquefaction facility. Mozambique’s Minister of Mineral Resources
and Energy Max Tonela said last week that he hoped these successes marked a step in the right direction.
“We are hopeful that this performance by the defence and security forces will continue in such a way that not only Mocimboa da Praia, but all the districts affected [in Cabo Delgado], are retaken, thus ensuring that the population can resumetheirnormalactivities,”hewasquotedas sayingbytheindependentTVstationSTV.
When asked whether this development might prompt TotalEnergies and its partners to resume work on the Afungi Peninsula, Tonela struck a note of cautious optimism. Construction can only be restarted if the area is made secure again, but the consortium is committed to moving ahead with its investments in Mozambique, he said.
TotalEnergies is the operator of the Mozam- bique LNG consortium, and its subsidiary Total E&P Mozambique Area 1 has a 26.5% stake in the project. The remaining equity is divided between two Japanese companies, Mitsui and Japan Oil, Gas and Metals National Corp. (JOGMEC), which have 20%; Mozambique’s national oil company (NOC) ENH, with 15%; Bharat Petroleum (India), with 10%; ONGC- Videsh (India), with 10%; Beas Rovuma Energy Mozambique (a 60:40 joint venture between ONGC-Videsh and Oil India Ltd, or OIL), with 10%; and PTTEP (Thailand), with 8.5%.
The partners aim to extract gas from Area 1, which lies offshore within the Rovuma basin, and use it as feedstock for the LNG plant. This facility will eventually have two production trains, each with a capacity of 6.44mn tonnes per year (tpy).
Mozambique’s government has partnered with Rwanda to mount a military campaign against ASWJ.
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