Mozambique: Five-fold increase in natural gas production expected by 2029

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Mozambique: Five-fold increase in natural gas production expected by 2029

1:53 CAT | 01 Apr 2025

FILE - For illustration purposes only. [File photo: Eni]

Mozambique plans to increase production of liquefied natural gas (LNG) by 500% in five years, to 20 million tonnes per year (mtpa), according to data from the government’s Five Year Programme 2025 – 2029 (PGQ) accessed by Lusa on Tuesday.

According to the forecasts set out by the government in the document, which will be discussed over the next few weeks in the first ordinary parliamentary session of the legislature, this growth contrasts with the starting base of 3.30 mtpa in 2024.

Another objective of the PQG, the first of the executive led by President Daniel Chapo, who took office in January, sets the target of increasing the number of contracts signed for hydrocarbon research from the current seven to 16 in 2029.

Mozambique has three development projects approved for the exploration of natural gas reserves in the Rovuma basin, classified as among the largest in the world, off the coast of Cabo Delgado, including one by TotalEnergies, still suspended due to security concerns on the Afungi peninsula, with only the one led by the Italian company Eni in production, with a forecast of doubling volumes.

In the PQG, the Government also estimates growth in the gross domestic product (GDP) per capita from the current US$662 (€612.5) to US$951.71 (€880.5) in 2029, driven precisely by LNG projects.

Meanwhile, the financial rating agency Fitch reported in March that the expected resumption of the TotalEnergies LNG project this year would facilitate ExxonMobil’s long-awaited decision on another megaproject in northern Mozambique.

“The resumption of construction of the TotalEnergies LNG project could facilitate a final investment decision on the US$30 billion [€27.6 billion] LNG project proposed by ExxonMobil. This project would be partially onshore and would contribute to economic growth during its construction phase,” reads an assessment by Fitch Ratings, consulted by Lusa.

The rating agency adds that the production capacity of this ExxonMobil project “could be the largest to date in Mozambique, with a total capacity of 18 million tonnes per year, compared to 12.9 mtpa for the TotalEnergies project”.

TotalEnergies, the leader of the Area 1 consortium, is currently developing the construction of a plant in Afungi, near Palma, for the production and export of natural gas.

This is one of three projects under development in Mozambique, suspended since 2021 due to the terrorist attacks in Cabo Delgado, which led the oil company to invoke ‘force majeure’ and withdraw all personnel, but which is preparing to resume work, while finalizing the conclusion of financing contracts worth US$15 billion (€13.8 billion).

In October, ExxonMobil chose the American company McDermott to work in a consortium to prepare the engineering project for the natural gas production unit in Mozambique within 16 months, prior to the final investment decision (FDI).

“The Rovuma LNG Phase 1 project represents a significant development for the country and provides a significant opportunity for economic growth. The project includes the liquefaction and export of natural gas extracted from the Area 4 offshore fields off the Afungi peninsula in Mozambique [Cabo Delgado],” reads a statement from McDermott.

In addition to ExxonMobil, the consortium also includes the Italian Eni and the Chinese National Petroleum Corporation (CNPC), which hold a 70% stake in the Exploration and Production Concession Contract for Area 4.

According to initial estimates, Exxon’s project in Cabo Delgado – a northern province affected by terrorist attacks for seven years – was expected to produce 15.2 mtpa of LNG, since revised upwards to 18 mtpa.

Source: Lusa