Mozambique “pawns” development for being unable to compete in gas infrastructure – NGO

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Mozambique “pawns” development for being unable to compete in gas infrastructure – NGO

6:25 CAT | 18 May 2017

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Mozambique’s Public Integrity Centre (CIP) yesterday accused the government of “pawning” development by being unable to participate in the development of natural gas infrastructures.

“The participation of the state in the development of natural gas logistics infrastructure is not guaranteed,” a CIP analysis sent to Lusa says.

The Mozambican state’s absence, the document continues, will allow the consortia led by Italy’s ENI and the US-based Anadarko to operate in an exclusive position in gas-related logistics.

“The conditions are thus created for the multinational companies Anadarko and Eni to be exclusive operators of the logistic infrastructures during the decades of the concession and exploitation of natural gas in areas 1 and 4 of the Rovuma basin,” the text says.

“This negates the possibility of building a commercial port in Palma that would be a catapult of local development.”

Referring specifically to the Pemba Logistics Base (BLP) in the northern province of Cabo Delgado, the CIP criticizes the Government for failing to rise to the challenge of the project.

“Reality on the ground shows that the government is failing to develop [coordination, concession, construction and management] infrastructure,” the analysis said.

So far, the text continues, little has been done and the state has been the target of legal proceedings as a result of bad deals related to the enterprise.

The CIP recalls that, two years ago, the design, construction, operation and management of Pemba Logistics Base was started with government consent.

“The Pemba logistics base of was concessioned off, without a public tender, to ENH Integrated Logistics Services, SA (ENHILS), a company that is made up of the Mozambican companies ENH Logistics and ENH Rovuma Area 1, SA,” says CIP.

At the time, the expectation was that the infrastructure would be ready by the end of 2016, and support the construction of the liquefaction plant, whose operation was to start in 2018.

The BLP project integrates a liquefied natural gas maritime terminal and a bulk materials unloading facility, granted exclusively to Anadarko and Eni.

On Tuesday, the Mozambican Council of Ministers approved the financing structure of the floating platform for natural gas (FLNG) of the consortium led by Italy’s ENI production.

Despite being a member of the ENI consortium through the National Hydrocarbons Company (ENH), the Mozambican government will not pay its subscribed capital share in the investment because of its current financial incapacity, and compensation for this is still to be negotiated, and may include waiver of dividends for some period.

Portuguese Galp is another of the companies in the ENI consortium.

Source: Lusa