Rovuma Basin LNG: Concessionaires spend $500 million on local content – report

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Rovuma Basin LNG: Concessionaires spend $500 million on local content – report

2:24 CAT | 17 Mar 2020

File photo: Noticias

The multinationals implementing liquefied natural gas (LNG) projects in Cabo Delgado’s Rovuma Basin Area 1 have already spent around US$500 million on goods and services provided by Mozambican companies.

This is part of the US$2.5 billion the concessionaires, led by the French oil major Total, have agreed to spend with national companies providing services or goods for the Area 1 project.

Speaking a few days ago days in Maputo, chairman of the Board of Directors of the National Petroleum Institute Carlos Zacarias said that an increasing number of Mozambican companies were interested in participating in hydrocarbon research and exploitation projects in the country.

“We have created a database and registered 1,400 companies, 427 of which are registered in Mozambique, and 307 are owned by Mozambicans, which is encouraging for an effort to boost the national economy,” he said.

Zacarias said that the Mozambique LNG project, led by Total, currently employs around 7,000 Mozambicans, of whom 50 percent are residents of the area where the project is being developed, the rest coming from other parts of Cabo Delgado province.

“We believe that the development of policies and regulations for local content will have a considerable impact on national companies. There is already legislation that regulates and defines the procedures for the provision of goods and services to multinationals,” Zacarias noted.

One of the main constraints on the Mozambican business community benefiting from opportunities in gas exploration projects is related to the fact that the majority do not meet the standards demanded by oil companies.

To counteract this, Mozambique’s Institute of Small and Medium Enterprises, in partnership with the multinationals operating in the country, has launched a business certification project to build up SMEs so that they can benefit from the opportunities.

The private sector has also advocated a National Content Law which would, according to ‘Noticias’, reserve a place in megaproject shareholder structures for Mozambican SMEs.

Source: Noticias