Sasol-led consortium to invest US$1.4 billion in fuel factory in Mozambique

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Sasol-led consortium to invest US$1.4 billion in fuel factory in Mozambique

11:21 CAT | 30 Jun 2017

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The consortium led by South African petrochemical company Sasol is to invest US US$1.4 billion in a new fuel production plant in Inhambane province, southern Mozambique, a company source has told Lusa.

According to the Sasol Communications Office, the future liquid processing facility will be built in the province of Inhambane, southern Mozambique, and will produce light oil, liquid petroleum gas and natural gas.

“Currently, the initial stage of development is being implemented, and the drilling of the sixth well has been completed and underground data obtained to date have been analysed,” the source said in written responses to Lusa.

The LPF will be built next to the natural gas facility that the company already operates in Temane, Inhambane, and will be constructed under the field development plan approved by the Mozambique government.

At the peak of the project, 2,000 people will be employed.

Sasol’s Communications Office said that the South African company is currently in discussions with the National Petroleum Institute, the sector regulator in Mozambique, to finalise oil exploration and production concession contracts (EPCC) in blocks PT5-C and A5-A, also in the province of Inhambane.

“It is intended to complete the EPCC for both blocks as soon as possible, so that the proposed work program and associated drilling campaign can be continued,” the statement reads.

Sasol, it states, believes that Mozambique remains an investment destination and that the country is central to its growth strategy in Southern Africa.

The company “remains interested and will assess the additional [business] opportunities as they arise,” it added.

Sasol’s Communications Office also announced that the consortium led by the South African petrochemicals company concluded the building of a 128-kilometre pipeline between Funhalouro, Inhambane province, and Chigubo, Gaza province in late 2016, increasing gas transportation capacity from 185 to 209 million giga-Joules per year.

This line joins the company’s first, 865-kilometre, gas pipeline linking Temane with Secunda in South Africa.

Sasol has been producing natural gas in Mozambique from concessions in Inhambane province since the beginning of 2000.

In addition to the Inhambane gas reserves, the country also has resources in the Rovuma Basin, Cabo Delgado province, northern Mozambique, where the best-known fields have been granted to consortiums led by Italy’s ENI and North American Anadarko.

ENI announced its final investment decision to move forward with the production of liquefied natural gas earlier this month, with the same expected from Anadarko soon.

Source: Lusa