Latest News: Oil & Gas in Mozambique

Government and Anadarko claim advances

On Friday 21 October, the Mozambican government and Anadarko announced that advances have been made in implementing Anadarko’s plans to set up a LNG plant in the northern province of Cabo Delgado.

Their optimism was expressed after a meeting in Maputo between Prime Minister Carlos Agostinho do Rosário and Anadarko representatives. This was a follow-up to President Filipe Nyusi’s visit in September to the Anadarko headquarters in Houston (Texas).

“We have held this sort of meeting regularly”, the Chairperson of Mozambique’s National Petroleum Institute (Instituto Nacional de Petróleo, INP), Carlos Zacarias, told reporters. “It was a good meeting, and we could see that there are palpable and positive results. Naturally they need to gone into in greater depth to implement the project in the Rovuma Basin”.

“We are approaching our final goal, which is to begin the activities, and we are also removing possible obstacles which could throw implementation of the project out of joint”, Zacarias added.

Anadarko Vice-President John Grant said that great progress has been made with the legal aspects of project implementation. “Also discussed were technical aspects concerning construction of the port, of the maritime terminal, and of the LNG factories”, he said.

The meeting with the Prime Minister also covered the resettlement of people living in the Afungi Peninsula, in Palma district, where the factories will be built. Anadarko is the operator of Rovuma Basin Offshore Area-1, with a holding of 26.5%. The other members of the consortium are Mitsui of Japan (20%), the Indian companies ONGC Videsh (16%), Oil India (4%) and BRPL Ventures (10%), PTT of Thailand (8.5%), and Mozambique’s own National Hydrocarbon Company, ENH (15%).

So far, the exploration of Area-1 indicates that it contains more than 75-trillion cubic feet (tcf) of recoverable natural gas reserves. The consortium hopes to begin LNG production in the first quarter of 2020. However, Anadarko has not yet announced its final investment decision, and, speaking to reporters earlier in the week, ENH chairperson Omar Mithá said he was not expecting the decision until the third quarter of 2017.

Initially, Anadarko plans to produce 12million tons of LNG a year, using two factories (known as “trains”). Later it hopes to raise production to 20-million tons a year.

Source: Agencia de Informacao de Moçambique

Scottish oil and gas trainers to visit Mozambique and Tanzania on East Africa trade mission

A Scottish delegation is scheduled to visit East Africa to help train people in the oil and gas industry, and mining and construction. Ten training providers will share their skills with workers in Tanzania and Mozambique. The mission aims to raise the skills base in East Africa, which is home to some of the largest offshore gas fields in the world.

It is being led by Scottish Development International. Two previous missions have led to contracts between Scottish and African companies and universities. They included a deal between Dundee and Angus College and People Positive East Africa Ltd. to provide “train the trainer” welding courses to Kenyans. Training specialist MDT International also won contracts to deliver courses in Tanzania, Kenya and Mozambique.

Among those joining the mission this year are Synergie Training, Sibbald, Epit Group, Forth Valley College and Edinburgh College.

World-leading hub:

International sector head for oil and gas at Scottish Enterprise, David Rennie, said that: “Scotland is a world-leading training hub for the oil and gas sector and is well placed to support East Africa’s skills shortages. “Companies are already seeing success in this key market and this third mission aims to facilitate, in this current climate, even more opportunities for our supply chain, particularly for those companies visiting for the first time”.

Source: BBC

Exxon’s pacific LNG model seen as future for Canadian gas

Canada’s LNG developers will band together and merge projects like producers in Papua New Guinea are trying to do as a price crash limits cash for individual export terminals, according to IHS Markit Ltd.

Producers must also green-light projects now so they can start by 2022, when the market will be in deficit, according to Bob Fryklund, the consultancy’s chief upstream strategist. Companies involved in those projects should share facilities to produce LNG, like ExxonMobil Corp. has proposed for its venture in Papua New Guinea with Total SA and Oil Search Ltd., he said. At least 20 export proposals in Canada haven’t reached final investment decisions, according to Bloomberg New Energy Finance.

“Papua New Guinea is going to end up with one liquefaction plant and some people own individual trains. That is probably the model that will happen in Canada”, Fryklund said on Thursday 27 October in an interview in Tokyo. “It’s a competitiveness issue, there is still some consolidation going on among the operators”.

Royal Dutch Shell Plc., ExxonMobil and Chevron Corp. are all involved in separate LNG proposals in Canada. Malaysia’s Petroliam Nasional Bhd received conditional approval last month for its proposed US$27-billion Pacific NorthWest LNG, though it hasn’t yet decided whether to move forward with the project.

Spot LNG in Northeast Asia, which rose 2.2% UD$6.95 per million British thermal units on 24 October, has fallen by about two-thirds from a peak in 2014 as new projects boosted supply faster than demand has grown. As a result of the glut, the industry globally hasn’t approved a new onshore greenfield development since December 2013, according to Wood Mackenzie Ltd. analyst Chong Zhi Xin.

Mozambique, US:

In Mozambique, where one of the world’s largest LNG projects is awaiting a final investment decision, there may be additional consolidation, according to Fryklund. ExxonMobil is buying a stake in

ENI SpA’s offshore Rovuma Basin there, state-owned ENH Chairman Omar Mithá said on 20 October. The purchase could spur development of export projects in the African nation, according to Mithá.

Assuming operators finalise approvals next year and begin construction in 2018 the earliest any of Canada’s LNG projects could begin producing would be 2023, according to BNEF analyst Anastacia Dialynas.

Most of the new global LNG export capacity will come from the US, according to Fryklund. America sent its first cargo produced from shale from the lower 48 states in February.

Earlier this month shipper Cheniere Energy Inc. was cleared by US regulators to start loading tankers with LNG from a second plant at its landmark Sabine Pass terminal in Louisiana. The company plans to bring online a third plant and start the commissioning of a fourth next year.

“There will still be LNG projects going forward but it has to be extremely competitive”, Fryklund said. “The bulk of the new LNG is still going to come out of the U.S. Gulf Coast”.

Source: Bloomberg

Gulamo family prepares for major energy projects

Grupo Gulamo is currently working on expanding GS Holding, the joint venture it formed with the Tanzanian Sumaria Group. But it does not nevertheless neglect its own interests.

Several members of the Gulamo family, beginning with the patriarch Rajahussen Gulamo, have recently created the firms Industria Nacional del Cemento (specialising in the production and sale of cement) and Sociedade Moçambicana de Petroleos (Somopetro, import and sale of oil products).

The Gulamo family is counting on the gas projects due to start off the coast of Mozambique and on the construction projects that will ensue. A few weeks ago GS Holding created GS Petroleum and GS Energy, specialised in the production and transport of oil and electricity.

Source: Africa Confidential

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