Page 12 - AfrOil Week 12 2022

AfrOil POLICY AfrOil

The resulting volumes will then be processed companies (IOCs), including Eni of Italy, Exx-
into gasoline, diesel, fertiliser and other refined onMobil of the US and France’s TotalEnergies,
fuels and chemicals, it said. are developing the gas for export to Asia and
The idea came up for discussion in February, Europe.
when Zimbabwe’s President Emmerson Mnan- Hydrocarbons were found at the Buzi block
gagwa met his Mozambican counterpart Filipe in the 1960s, reports say, but the quantities were
Nyusi in Maputo. too small to merit commercial exploration and
Victor Matemadanda, Zimbabwe’s ambas- development. Then in 2019, Buzi Hydrocarbons
sador to Mozambique, was quoted by Energy Pte Ltd of Indonesia partnered with Mozam-
Capital & Power as saying on March 14 that if bique’s state oil and gas company Empresa
the project materialises, it will help cut his coun- Nacional de Hidrocarbonetos (ENH) to drill
try’s electricity import bill and contribute to the for hydrocarbons in Buzi.
socio-economic development of both countries. The partners drilled their first exploration
“In this agreement, we will co-own gas fields and well to a depth of 1,567 metres and found gas.
we will do the extraction together as partners, They were due to drill a second well in 2020, but
meaning there is potential to reduce our import the coronavirus (COVID-19) outbreak caused
bill on gas products,” he said. work to be stopped.
Mozambique’s gas reserves amount to about South Africa’s Sasol is already producing
180 trillion cubic feet (5.1 trillion cubic metres), gas at the Pande and Temane field in southern
with most of the total located within fields in Inhambane province. Most of the gas from these
the Indian Ocean. Several international oil fields is being exported to neighbouring South

UK court split on export credit

to finance Mozambique LNG

MOZAMBIQUE A legal challenge by an international environ-
mental protection group seeking to block Brit-
ain from financing a major natural gas project in
Mozambique has yielded a split decision.
Friends of the Earth (FoE) brought a High
Court challenge to a 2020 decision by export
credit agency UK Export Finance (UKEF) to
provide $1.15bn to a consortium led by French
supermajor TotalEnergies to develop a liq-
uefied natural gas (LNG) project in northern
Mozambique.
The campaigners argued that the financing
was unlawful and contradicted Britain’s com-
mitment to cut greenhouse emissions. However,
the two judges hearing the challenge did not
fully find with FoE, but they did rule that they
could escalate the matter to the UK Court of
Appeal, London-based Energy Voice reported
on Wednesday (March 16).
One of the magistrates, Lord Justice Stu-
art-Smith, said the decision “would have no
material impact on the emissions generated by
the project, which was and is going to be devel- Mozambique LNG will process gas from Area 1 (Image: TotalEnergies)
oped in any event”, The National (UAE) reported
on the same day. temperature rise to 1.5 degrees. Its approval was
The other judge, Justice Thornton, agreed therefore unlawful.
with FoE, saying the UKEF’s decision to fund TotalEnergies is the operator of the $20bn
the LNG project was granted without a com- project, which aims to extract 16 trillion cubic
plete understanding of its climate impacts, FoE feet (453bn cubic metres) of gas over 30 years
said. He further said that there was “no rational from a site off Mozambique’s Indian Ocean
basis” to show that the financing of the project coast. However, the partnership suspended
was consistent with the terms of the Paris Agree- work in the spring of 2021 in the face of Islamist
ment and international ambitions to limit global attacks near the onshore liquefaction site.

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