Mozambique expects FID on Exxon-led Rovuma LNG project by 2026

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Mozambique expects FID on Exxon-led Rovuma LNG project by 2026

7:55 CAT | 15 Aug 2024

Photo: Presidente Filipe Nyusi/Facebook

US major ExxonMobil expects to make a final investment decision (FID( on its Mozambique liquified natural gas project in 2026, President Filipe Nyusi announced on Wednesday.

The head of state held a meeting yesterdayin Maputo with Liam Mallon, president of ExxonMobil Upstream Company.

Nyusi and Mallon discussed “progress made within the scope of the LNG project” in the Rovuma basin, Cabo Delgado.

“We focused our discussions on the initial engineering phase of the project, now with plans to finalise approvals and make the Final Investment Decision by 2026,” reads a message by President Nyusi, brought yesterday on his official Facebook page..

“As significant advances were presented, it was reiterated that this project will be one of the least polluting initiatives and with all the potential for a promising future in the liquefied natural gas sector”, Nyusi added.

ExxonMobil’s CEO in Mozambique, Arne Gibbs, had announced on May 3 that the final investment decision could be made by the end of 2025.

“We are optimistic, we are moving forward, but we recognise that there are still challenges,” he said in statements quoted by the Bloomberg financial information agency, in which Giibbs signalled that the FID would only be made at the end of next year, fulfilling the forecast made in July to start in 2025.

Gibbs’ statements came in the same week that Mozambique’s President had said that funding was no reason to delay the implementation of the natural gas megaprojects, led by France’s TotalEnergies and the US’s ExxonMobil.

“It’s fundamental [to go ahead with the projects] because it can’t be a problem of a funding decision, now, associated with the terrorist situation. This project already existed, it’s old. That means there was clarity in its execution. It can’t run aground for this reason, let’s look for others,” criticised Filipe Nyusi at the opening of the 10th edition of the Mozambique Mining and Energy Conference and Exhibition in Maputo.

In his speech, Nyusi called on the concessionaires of Area 1, led by TotalEnergies, to “accelerate the development of the resumption of onshore projects” given the “gradual promising stability” in the Afungi peninsula, Palma district, Cabo Delgado, and addressed concessionaires of Area 4, onshore, led by ExxonMobil, recommending that “the process leading to the Final Investment Decision be accelerated, with the necessary adjustments to the Development Plan approved in 2018”.

President Nyusi noted at the saem speech that the “delay” in realising this type of project “causes problems”, because the “expectations of the countries are enormous” and because “people think that part of their problem may be solved” by them.

In the statements quoted by Bloomberg on May 3, Arne Gibbs confirmed that Exxon has completed the preliminary engineering and design work for the 18 million tonne per year project in the Rovuma basin adding that the group of engineers and designers would begin the project “in the coming months”.

Exxon’s project in Cabo Delgado – a northern province hit by terrorist attacks for more than six years – was initially conceived to produce 15.2 million tonnes per year, but in May the company was envisioning annual production of 18 million tonnes

The Rovuma LNG project will be “the largest liquefied natural gas project in Africa, and could be the largest project in African history”, Gibbs added.

Mozambique has three approved development projects to exploit the natural gas reserves of the Rovuma basin, classified as among the largest in the world, off the coast of Cabo Delgado.

Source: Lusa