Mozambique's council of ministers has granted approval to a planned liquefied natural gas project off the northern coast of the country near the border with Tanzania. Texas-based Anadarko Petroleum Corp. is behind the $20-billion operation.
The project, which would be the first to supply Mozambique's proposed onshore LNG processing plants, consists of two initial trains with total capacity of 12 million tons per annum (MTPA). Feedstock for the plant will come from natural gas fields in Area 1, operated by Anadarko with a 26.5% working interest. Other partners include Empresa Nacional de Hidrocarbonetos E.P., Mitsui E&P Mozambique Area 1 Ltd, ONGC Videsh Ltd, Bharat PetroResources Ltd, PTT Exploration & Production Plc and Oil India Ltd.
Anadarko said on Feb. 6 it has made progress in discussions with its partners in Area 1 on long-term LNG offtake agreements, with key terms agreed for 5.1 MTPA of the 8.5M TPA required for the project to reach a financial close.
"Finalization of the contract with the selected onshore contractor is underway and all offshore tender packages were issued to prepare for the selection of the offshore contractor and vendors," Anadarko says in its fourth quarter 2017 results announcement. Anadarko could not immediately confirm the name of the selected onshore contractor.
In mid-December, Anadarko signed an agreement with Japan's Tohoku Electric Power to purchase of up to 280,000 tons per year of LNG from the export project for a period of 15 years.
"We are encouraged to hear the positive news coming out of Mozambique last week that the Plan of Development has been approved, and we look forward to receiving official confirmation from the government in due course," said Helen Wells, Anadarko's communications manager in an email to ENR.
Mid-2017, Anadarko finalized two agreements with concessions awarded from the Government of Mozambique, together referred as "marine concessions," that allow the company "to own, design, build and operate the marine facilities for the LNG project."
"Lenders are keenly engaged and have indicated a willingness to support the initial project with the necessary levels of project finance commitments. We are actively negotiating the terms and conditions of the financing," Wells said.
Anadarko and Italy's Eni have discovered more than 180 tcf of natural gas reserves in the Rovuma basin. The proposed LNG export project is set to transform Mozambique into a major exporter in 2023.
Earlier, a consortium of developers comprising of Chicago Bridge & Iron, Saipem (Italy) and Chiyoda (Japan) were picked to construct the LNG project, with Anadarko announcing in January 2017 it had submitted the LNG Plan of Development to Mozambican authorities and had anticipated a Final Investment Decision by the end of 2017.