Page 5 - GLNG Week 25

GLNG afRiCa GLNG
Reaching FId, though, was a di cult prop- osition. In 2012, Anadarko predicted FId could come in 2013, with rst production due in 2018.
Progress on Mozambique LNG was di cult as the companies backing the project lacked the resources to drive it forwards on their own. In order to secure financing, sales and purchase agreements (SPAs) were needed to cover a large share of the proposed output. e last such SPA was reached with Japan’s JERA and Taiwan’s CPC in May for 1.6 million tpy, taking the total amount signed to 11.1 million tpy of long-term sales.
impact
Wood Mackenzie has predicted revenues to the government from this project will be US$3 bil- lion per year from the early 2030s.
A statement from Standard Bank, which has provided a number of studies on the Mozam- bique gas projects, said this FId could improve the availability of foreign currency in the coun- try and reduce in ation risks. Following the FId declaration, the bank said it expected the Bank of Mozambique may resume reducing interest rates.
Standard Bank’s chief economist, Fáusio Mussá, warned that some of the impact of the project would only become apparent in the longer term.
“ e positive impact on economic activity in general will only be relevant once the country beginstoexportnaturalgas,betweentheendof 2023 and 2024,” he said. In order to maximise the potential gains, the country must take steps to meet demand for goods and services. “ is preparation is occurring at various levels in the country, but there is still a long way to go, and Standard Bank has created a Business Incubator that has been supporting Small and Medium Enterprises (SMEs) to access some of these opportunities.”
A report from Standard Bank on the project’s macroeconomic impact, modelling six trains of LNG, projected the Mozambique government may receive US$212 billion over the lifespan of the development.
ExxonMobil and Eni are eager for the
Rovuma LNG project to get on track as well – and have said they are targeting FId this year. is project will produce 15.2 million tpy from two trains, with investment of US$27-32 billion. Standard Bank predicted revenues from this pro- ject to the government would be US$4-5 billion per year for 25 years.
importers
Mozambique is able to serve as a source for Asia and Europe, positioning the country to supply either region as demand uctuates between the two as the seasons change. demonstrating this opportunity, Mozambique LNG signed a dou- ble-headed deal in February, with Tokyo Gas and Centrica.
Agreeing to supply 2.6 million tpy, the agree- ment provides for LNG ows to shi depending on demand – a position the Japanese govern- ment has taken pains to support in recent times in its move to reduce territorial restrictions in sales contracts.
Standard Bank has highlighted the impor- tance of Asia, and China in particular. e coun- try should aim to become an “anchor supplier” to China, which is ramping up imports, which jumped 39% in 2018. Tying up supplies to China would allow Mozambique to develop “major, domestic industries which are economic bed- rocks within such economies and employ thou- sands of indigenous citizens and boost national prosperity”.
e future seems rosy for Mozambique, but it has not been a smooth ride. e country has faced gruelling nancial renegotiations – with hidden debts having piled up on the expecta- tion of faster-than-realised gas revenues – and a mounting insurgency in the north. Violence in the area has had an impact on some of the con- struction plans, with a contractor killed earlier this year.
Gas revenues should go towards solving some of the country’s problems, but with polit- ical power seeing some areas receive more sup- port than others, and tensions still evident from Mozambique’s turbulent past, this is by no means a certainty.™
PaRtnERs:
Anadarko moçambique Área 1 is the operator of Area 1 with a 26.5% working interest. eNH rovuma Área um
has 15%, mitsui e&p mozambique Area1
has 20%, oNGc Videsh ltd (oVl) has 10%, beas rovuma energy mozambique has
10%, bprl Ventures mozambique has 10% and pttep mozambique Area 8.5%.
the mitsui unit is 50:50 owned with the Japan oil, Gas and metals National corp. (JoGmec). beas rovuma is 60% owned by oVl and 40% by oil india.
Week 25 27•June•2019 w w w . N E W S B A S E . c o m
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