Mozambique: ExxonMobil expects design work on Rovuma LNG project completed within a year

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Mozambique: ExxonMobil expects design work on Rovuma LNG project completed within a year

10:35 CAT | 24 Sep 2024

Photo: Presidente Filipe Nyusi/Facebook

ExxonMobil expects to complete the technical design of the natural gas extraction project in northern Mozambique within a year, the vice president of the U.S.-based oil and gas company, Walter Kansteiner, announced yesterday in New York.

“We have announced our FEED — Front End Engineering Design, our cutting-edge engineering and design [of the project], and that takes about a year. So we look forward to progress on FEED in the next 12 or 13 months,” ExxonMobil’s vice president for International Government Relations Walter Kansteiner told journalists after a meeting in New York with the Mozambican President, who was ending a visit to the United States on Monday.

Exxon’s project in Cabo Delgado – a northern province affected by terrorist attacks almost seven years ago – was initially expected to produce 15.2 million tons of gas per year, but the company currently expects annual production of 18 million tons.

In August, the Mozambican president said that ExxonMobil expects to make a decision on the natural gas extraction project in northern Mozambique only in 2026.

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

The head of state, who received the president of ExxonMobil Upstream, Liam Mallon, in Maputo on August 14, explained at the time that he discussed with the head of the North American oil major “progress on the LNG project” in the Rovuma basin, in Cabo Delgado, in the north of the country.

“We have focused our discussions on the initial engineering phase of the project, with plans now to finalize approvals and make the Final Investment Decision by 2026. With significant progress being made, it was reiterated that this project will be one of the least polluting initiatives and has all the potential for a promising future in the liquefied natural gas sector,” explained Nyusi.

On May 3, ExxonMobil’s CEO in Mozambique, Arne Gibbs, had announced the possibility of the investment decision being made by the end of 2025.

“We are optimistic, we are moving forward, but we recognize that there are still challenges,” said the official, who then announced that the Final Investment Decision will only be made by the end of next year.

READ: ExxonMobil pushing forward with Mozambique LNG project, official says

Gibbs’ statements came in the same week that the President of Mozambique said that financing is not a reason to delay the implementation of the natural gas megaprojects, led by the French company TotalEnergies and the American company ExxonMobil.

“This [moving forward with the projects] is essential, because it cannot be a financial decision-making issue now, associated with the terrorist situation. This project already existed, it is old. This means that there was clarity in its implementation. It cannot be left stranded for this reason, others must be sought”, criticised Filipe Nyusi, during the 10th edition of the Mozambique Mining and Energy Conference and Exhibition.

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

In the same speech at the conference, the head of state stated that the “delay” in implementing this type of project “causes problems”, because “countries’ expectations are enormous” and “people are left thinking that part of their problem may be solved”.

In previous statements, Arne Gibbs confirmed that the oil company had completed the preliminary engineering and design work for the 18 million tonnes per year project in the Rovuma basin, and that the group of engineers and designers would begin the project “in the coming months”.

Regarding the insurgency that halted construction in March 2021, Gibbs commented: “There have been significant improvements in the security situation since we started in 2021, and we know that there is still more work to be done”.

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 explore the natural gas reserves of the Rovuma basin, classified as among the largest in the world, off the coast of Cabo Delgado.

Source: Lusa