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DMEA LNG DMEA

Eximbank to provide largest portion

of $14.9bn Mozambique LNG loan

MOZAMBIQUE THE US Export-Import Bank (Eximbank) is the onshore and offshore portions of the project.
set to make the largest individual contribu- It noted that its board of directors had authorised
Eximbank’s portion will tion to a nearly $15bn credit package that the the release of funds for onshore work, which will
cover the cost of goods Mozambique LNG consortium is using to fund primarily involve the construction of a gas lique-
and services provided its project. faction plant, in September 2019. The board then
by US companies. The US export credit agency (ECA) said in revised its authorisation in May 2020 to permit
a press release last week that it had signed the the release of funds for offshore work, which will
initial documents authorising a direct loan of mainly involve the development of the offshore
$4.7bn to Mozambique LNG. This is equivalent Area 1 block.
to around 31.54% of the credit package, which Mozambique LNG has already started to
is worth a total of $14.9bn. It is also the largest build an onshore gas liquefaction plant on the
single portion of the package, which is being Afungi Peninsula in northern Mozambique.
extended by a group that includes seven other This onshore facility will process natural gas
ECAs and 19 commercial banks. from Area 1, an offshore block in the Rovuma
According to the bank, the loan agreement Basin. It will eventually have two production
will benefit the US economy. Mozambique LNG trains, each with a capacity of 6.44mn tonnes
intends to use Eximbank’s portion of the credit per year, and the first train is due to come on
package to cover the cost of goods and services stream in 2024. The cost of the project has been
provided by US companies, it stated. estimated at $20bn.
“Once additional documents are finalised Equity in the Mozambique LNG consortium
and conditions are satisfied, EXIM’s financing is divided between Total E&P Mozambique Area
will support a forecasted 16,700 US jobs at 68 1, the operator, with 26.5%; two Japanese com-
suppliers located in eight states – Florida, Geor- panies, Mitsui and Japan Oil, Gas and Metals
gia, Louisiana, New York, Oklahoma, Pennsyl- National Corp. (JOGMEC), with 20%; Bharat
vania, Tennessee and Texas – and the District Petroleum (India), with 15%; Beas Rovuma
of Columbia,” it added. “Follow-on sales are Energy Mozambique (a 60:40 joint venture
expected to support thousands of additional jobs between ONGC Videsh Ltd (OVL) and Oil
across the United States.” India Ltd, or OIL), with 10%; Mozambique’s
Eximbank went on to say Mozambique LNG national oil company (NOC) ENH, with 10%;
would be using US goods and services for both and PTTEP (Thailand), with 8.5%. ™

Week 30 30•July•2020 www. NEWSBASE .com P15