Mozambique: ENH expects cooking gas unit in Inhambane to start work this year

Login

Register

http://www.clubofmozambique.com/

Mozambique: ENH expects cooking gas unit in Inhambane to start work this year

12:10 CAT | 12 Apr 2024

FILE - For illustration purposes only. [File photo: @Frank Rumpenhorst/dpa]

Mozambique’s state oil and gas company, Empresa Nacional de Hidrocarbonetos (ENH), expects its new cooking gas processing unit in Inhassoro, in Inhambane province, to start production by the end of 2024, according to a message from the chairman of its board of directors released along with in company’s 2023 report and accounts, to which Lusa had access on Friday.

In the message, Estêvão Pale highlights the implementation of the production sharing agreement (PSA) project with South African oil company Sasol, in the Inhassoro district.

He highlights “the satisfactory progress of the construction of the Temane Thermal Power Plant (with a capacity of 450 megawatts of electricity) and the 30,000 tonne per year LPG (cooking gas) processing plant in Inhassoro, which is scheduled to start production at the end of 2024.”

The PSA, he recalls, “envisages, respectively, the production of 53 million megajoules of natural gas per year, which will materialise the implementation of the Temane Thermal Power Plant, and the production of 4,000 barrels of light oil per day.”

Mozambique’s government, which had previously said that production at the unit would start in March 2024, predicts that the country will reduce its imports of bottled gas by 70% with the start of operations at the Inhassoro unit.

The ENH boss also emphasised the “positive performance” of the oil production contract (known as PPA) project, “despite the existing operational difficulties” in maintaining the production “‘plateau’ and guaranteeing the supply of the gas sales contracts in force” for the project.

“Revenues from this project continued to grow remarkably, as a result of the rise in natural gas prices on the international market,” he states.

In the Mozambique Basin, one of the country’s six sedimentary basins, ENH will continue its hydrocarbon exploration activities in 2023 in the Búzi, PT5-C and Mazenga blocks, the document states.

“Although research and exploration activities are high-risk, they are necessary and essential in order to ascertain the existence and increase of natural gas and/or oil reserves in the country, a ‘sine qua non’ condition for the development of new projects and the creation of business opportunities, both in Mozambique and in the region,” the message reads. “In relation to this activity, it is worth highlighting the discovery of gas in the PT5-C area, in the Bonito-1 exploration well, with the discovery evaluation plan having been approved in the same year.”

It adds that “like the previous year, the 2023 fiscal year was characterised by the retraction of project activities in the Rovuma Basin, in the north of Cabo Delgado province, due to the maintenance of the ‘Force Majeure'” in the face of terrorist attacks, cited by TotalEnergies in 2021 as the reason for its suspending the implementation of the natural gas megaproject, worth $20 billion (around €18.72 billion).

“With the latest positive developments in the region, which at the same time condition the project’s Force Majeure status, the reactivation of activities in the Rovuma basin is likely in the near future,” concludes Pale.

Source: Lusa