Mozambique plans to begin LNG exports by 2018


ABERDEEN, Scotland -- Mozambique hopes to export its first cargoes of liquefied natural gas by 2018, President Armando Emilio Guebuza said recently.

"We are doing our best to make sure that by 2018 the first trains are delivered to the market," said Mr. Guebuza, who was in Aberdeen at a conference to promote Mozambique's nascent oil and gas industry.

The East African nation is on the cusp of becoming one of the continent's biggest energy producers following the discovery of giant natural-gas fields in the deep waters off its northeast coast.

However, before any exports can begin, billions of dollars will have to be spent building the giant refrigeration tanks needed to cool the gas for shipping and developing port facilities big enough to house LNG carrier vessels.

Mozambique expects it will cost at least $40 billion to develop its natural-gas infrastructure, including a plant capable of exporting 20 million metric tons of LNG and a local distribution hub that will service its domestic energy needs as well as those of its near neighbors, said Minister of Mineral Resources Esperenca Bias.

"It will be the largest ever in Africa," said Ms. Bias.

However, it remains unclear which international companies will ultimately build the terminal. The right to export LNG currently rests with Italy's Eni and US explorer Anadarko Petroleum, the two firms operating the concessions where most of the 108 trillion cubic feet of natural gas have been found.

Anadarko and Eni have said in the past that they want to develop an LNG plant together, though analysts say a project of the scale envisaged by the Mozambique government would likely require additional investment from bigger players able to handle the huge costs involved and with well-established LNG shipping businesses.

Both companies are in discussions with the government about developing an LNG plant, said Arsenio Mabote, chairman of the state-owned chairman of the National Petroleum Institute. "It is up to the concessionaires to decide," said Mr. Mabote, adding that he expects the talks to conclude and a decision to be made on how best to proceed in the next few months.

In a statement, Anadarko said: "Anadarko previously announced a Heads of Agreement with Eni whereby they plan to develop the common offshore natural-gas fields in a separate, yet coordinated fashion, while developing the onshore LNG park jointly."

Dow Jones Newswires

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