Latest News!!! US$20 billion onshore LNG project waiting for Anadarko’s FID, waiting for Mozambique’s guarantees

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2015-05-25) The construction of the natural gas processing plant in the Area 1 block in the Rovuma basin is awaiting the final investment decision, which should happen by the end of this year or early next.

The company guarantees that it is determined to advance to the final phase of investment in the project of building two onshore liquefaction units of the hydrocarbon, worth US$20 billion.

Speaking in Maputo at the end of a meeting with the Mozambican Prime Minister, Vice President of Anadarko, Don MacLiver, stated that the construction of the two plants is expected to last at least four years, therefore leading to forecasts for the beginning of Liquefied Natural Gas (LNG) exploration to be set at 2020.

MacLiver indicated that Anadarko is in search of a second agreement with the Mozambican government that allows the execution of a project of great magnitude in the Rovuma basin. “We had a first agreement that allowed us to start prospecting and research. Now we know what amount of gas there is in the wells and we want agreements that may guarantee that we can execute a project of this magnitude,” said Don MacLiver.

The source denied that Anadarko is to consider the sale of its stake in Area 1 of the Rovuma Basin.

In the week prior to this meeting, Anadarko had announced the appointment of a consortium for a contract relating to the initial development of the onshore project of liquefied natural gas (LNG) in the Rovuma basin.

The aforesaid consortium consists of CB&I (Chicago Bridge and Iron), from the United States, Chiyoda Corporation, from Japan, and Saipem, from Italy.

The indication of the consortium was possible after a tender process to provide services in the areas of engineering, construction and installation of systems of production and of liquefaction of the natural gas.

The onshore LNG project will consist of two liquefaction units, each with a 6 MMTPA (million tonnes per year) production capacity, representing an increase of 1 MMTPA by liquefaction unit to the original plan, keeping the initially estimated cost.

The project also includes two LNG 180,000 cubic metre storage tanks, condensate storage tanks, marine port, associated infrastructures and facilities.

After selecting the CCS JV consortium, the final negotiation of a definitive agreement will follow before the final investment decision. The concessionaries must, in the coming months, submit to the Mozambican government their development plan.

Anadarko’s Area 1 block has estimated reserves of 75 trillion cubic feet of natural gas, enough to supply the residential market in the United States for 15 years.

In the Rovuma basin, which also operates the Italian ENI, natural gas reserves estimated at about 200 trillion cubic feet have been found. The investment planned for the exploration of gas in that area is estimated at US$100 billion, possibly making Mozambique the third largest exporter of natural gas.

Source: Lusa

Photo: CIN Moçambique / John Peffer and Don MacLiver from Anadarko (second and third from the Left) with mozambican prime minister Carlos Agostinho do Rosário (Right)

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