Mozambique: ExxonMobil will remain in Cabo Delgado, says minister – AIM report

Login

Register

http://www.clubofmozambique.com/

Mozambique: ExxonMobil will remain in Cabo Delgado, says minister – AIM report

5:20 CAT | 27 Oct 2021

Photo: TVM

The Mozambican Minister of Mineral Resources and Energy, Max Tonela, said on Monday that the American oil and gas giant, ExxonMobil, has guaranteed that it will continue its liquefied natural gas project off the coast of the northern province of Cabo Delgado.

Speaking to reporters in the Cabo Delgado provincial capital, Pemba, where a meeting of the Coordinating Council of his Ministry is under way, Tonela said “From the companies, including ExxonMobil, the indication we have is that they are reaffirming their commitment to the Afungi project, despite the reports that are circulating”.

He added that representatives of ExxonMobil will visit Maputo in early November to discuss the current situation of their natural gas project.

ExxonMobil has partnered the Italian energy company, ENI, in operating the gas fields in offshore Area Four of the Rovuma Basin. One project is certain to go ahead – this is ENI’s Floating Liquefied Natural Gas platform, under construction in a South Korean shipyard. It will be towed into position in the Mozambique Channel next year, and is expected to produce 3.4 million tonnes of LNG a year.

ExxonMobil is supposed to be in charge of onshore liquefaction, on the Afungi Peninsula. This is also where the French oil and gas company, TotalEnergies, plans to install two liquefaction plants.

TotalEnergies has signed its Final Investment Decision, and while work at Afungi was interrupted by the terrorist raid on the nearby town of Palma on 24 March, the French company insists that its staff will return to Afungi, as soon as the security situation allows.

But ExxonMobil has repeatedly postponed its Final Investment Decision, leaving a large question mark over the US company’s plans to invest as much as 30 billion dollars in the Rovuma Basin.

Back in March, the company’s Senior Vice President, Neil Chapman, cited by the Bloomberg agency, said there was still no forecast for when the investment decision might be taken.

This has fuelled suggestions that ExxonMobil might be about to abandon the Rovuma Basin. Last week the “Wall Street Journal” said the Mozambican investment could be cancelled, partly because investors are increasingly wary about new fossil fuel projects.

On the other hand, ExxonMobil has already spent about 2.8 billion dollars in acquiring its current position in Rovuma Basin Area Four, and the company management may be reluctant to pull out at this stage.

Watch the TVM report.