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JBIC, private Japanese banks to

lend $14bn to Mozambique LNG

MOZAMBIQUE A group of Japanese private and public-sector Corp. (JOGMEC), with 20%; Bharat Petro-
lenders has agreed to provide JPY1.5 trillion leum (India), with 15%; Beas Rovuma Energy
($13.95bn) worth of financing for the Mozam- Mozambique (a 60:40 joint venture between
bique LNG scheme. France’s Total is leading the ONGC Videsh Ltd (OVL) and Oil India Ltd
consortium set up to carry out the project, in (OIL), with 10%; Mozambique’s national oil
which Japanese investors have a 20% stake. company (NOC) ENH, with 10%; and PTTEP
According to Nikkei Financial Review, the (Thailand), with 8.5%.
credits will come from a syndicate that includes The partners are building their gas liquefac-
state-run Japan Bank for International Co-op- tion plant on the Afungi Peninsula within the
eration (JBIC), as well as the country’s top three framework of the Mozambique LNG project.
private sector commercial banks, Mitsubishi The onshore facility will process natural gas
UFJ Financial Group (MUFG), Sumitomo Mit- from Area 1, an offshore block in the Rovuma
sui Financial and Mizuho Financial. Nippon Basin. It will eventually have two production
Export and Investment Insurance (NEXI), an trains, each with a capacity of 6.44mn tpy. The
entity affiliated with the Japanese government, first train is due to come on stream in 2024.
has agreed to cover default risk for the syndicate
and will insure the credits for the private banks. Armed attack
JBIC is slated to make the largest contribu- In related news, Fenix Construction Services, a
tion, as it will provide $3bn worth of credits to local third-party contractor that has contributed
the consortium. The remaining sums will come to the Mozambique LNG project, reported last
from the Japanese commercial banks and from week that eight of its employees had been killed
the African Development Bank (AfDB), a mul- in an armed attack by a militant Islamist group.
ti-lateral financial institution. Fenix, which has been working under con-
Japan has a strong interest in ensuring the tract to some of the Mozambique LNG con-
success of Mozambique LNG, Nikkei Financial sortium’s sub-contractors, said it had suffered
Review noted. Total and its partners are building casualties after gunmen struck one of its vehicles
a gas liquefaction plant that will eventually turn near Mocimboa da Praia, a town in Cabo Del-
out more than 12mn tonnes per year (tpy) of gado. Eight out of the 14 workers riding in the
LNG, and 30% of the total is slated to go to Jera, vehicle died in the attack, while another three
a joint venture set up by Tokyo Electric Power are still missing, it stated.
Co. (TEPCO), Chubu Electric Power, Tokyo This is not the first action that Islamist forces
Gas and Tohoku Electric Power. Jera’s members have carried out in the area. Armed militants
intend to regasify the LNG so that it can be used attacked and occupied Mocimboa da Praia,
to fuel thermal power plants (TPPs). which lies south of the site where Mozambique
Equity in the Mozambique LNG consor- LNG is building its onshore gas liquefaction
tium is split between Total E&P Mozambique plant, in March this year. They also attacked a
Area 1, with 26.5%; two Japanese companies, convoy of workers in February 2019, injuring
Mitsui and Japan Oil, Gas and Metals National four people. ™

Mozambique LNG will process natural gas from the Area 1 offshore block (Image: Total)

Week 27 08•July•2020 www. NEWSBASE .com P11