By tackling security challenges and cooperating with regional gas powerhouses including Equatorial Guinea, Mozambique is well on its way to become a global gas hub on the back of project resumption.
Significant natural gas resources and large-scale developments have positioned Mozambique as a highly attractive gas market. Despite project delays in 2021, the country is more committed than ever to seeing projects resume, new developments kick off and the domestic market secure further investment in 2022 and beyond. During an official state visit to Equatorial Guinea, H.E. Filipe Jacinto Nyusi, President of the Republic of Mozambique, decided to spend a day discussing liquefied natural gas (LNG) and gas monetization, conducting an official visit to the Equatorial Guinea LNG (EG LNG) project at Punta Europa led by H.E. Gabriel Mbaga Obiang Lima, Minister of Mines and Hydrocarbons, Equatorial Guinea.
During the visit to EG LNG, H.E. President Nyusi held bilateral talks with H.E. Minister Lima, discussing how LNG infrastructure works and how this infrastructure can kickstart socioeconomic growth by generating critical revenue for the host country. By touring the project, H.E. President Nyusi gained first-class insight into what an LNG plant can do for a country and what the government can do to support projects of this nature. For Mozambique, the visit marked a critical step for the country’s energy sector, with the President gaining knowledge and insight from one of Africa’s biggest natural gas players. For Equatorial Guinea, new opportunities for regional collaboration have emerged, and with Mozambique set to undergo unprecedented market growth, future partnerships will be instrumental for strengthening Africa’s domestic markets as a whole.
“Equatorial Guinea’s developments are a great example as to what LNG projects and gas monetization can do for Africa. It is great to see H.E. President Nyusi in Equatorial Guinea. This visit will give the President key ideas and examples as to what governments can do to drive gas monetization. Mozambique is going to see similar large-scale LNG projects that will drive Africa’s gas markets and position the continent as a globally competitive energy sector,” states NJ Ayuk, Executive Chairman of the African Energy Chamber (AEC).
As the AEC states in its Q1 2022 report, the growth of Mozambique’s gas market in 2022 and onwards will be a game changer for Africa’s hydrocarbon market and will help set the continent on a trajectory towards becoming a global energy hub. It is for this reason that H.E. Nyusi is committed to seeing projects resume. At a time when gas production across Africa needs to ramp up to meet growing demand both regionally and internationally, Mozambique’s projects will play a critical role in ensuring energy security. With over 100 trillion cubic feet of gas reserves, the southern African nation is well positioned to be the preferred supplier to both Europe and Africa and large-scale projects are a testament to this.
The Coral FLNG, for example, comprising approximately 450 billion cubic meters of gas in the Coral South Field in Area 4 in the Rovuma Basin off the coast of Mozambique, will enable the southern African country to produce 3.4 million tons per annum (mtpa) of gas for export to Europe and Asia in 2022. Additionally, TotalEnergies’ 12.8 mtpa Mozambique LNG project and Eni and ExxonMobil’s 15.2 mtpa Rovuma LNG project have the potential to transform the regional gas market, positioning Mozambique as a highly competitive gas exporter. Despite both projects having been delayed, progress is being made to get these developments back on track.
“Mozambique has the potential to transform the African energy space while emerging as the preferred supplier to international markets. Getting the country’s gas projects back on track is a top priority, and during African Energy Week (AEW) in Cape Town, discussions will be centered around this very narrative,” states NJ Ayuk, Executive Chairman at the AEC.
Representing the voice of the African energy sector, the AEC is committed to seeing Mozambique’s gas future realized. Recently, an AEC delegation led by Ayuk traveled to Mozambique, meeting with H.E. Carlos Zacarias, Minister of Mineral Resources and Energy, as well as Empresa Nacional de Hidrocarbonetos (ENH) to discuss gas monetization and making energy poverty history through gas. The AEC is looking at putting together various collaboration agreements that will be signed between Mozambique and various African countries during African Energy Week (AEW), centered around capacity building, driving investment and ensuring growth.
Equatorial Guinea represents both an ideal and critical partner for Mozambique as it looks to reawaken its gas market. The Punta Europe LNG development alone is considered one of Africa’s most important gas developments. The 3.7 million tons per annum LNG terminal not only processes domestic gas resources but regional reserves, serving as a top LNG processing facility in Africa and ensuring Africa’s resources are used in Africa. Accordingly, as a partner, Equatorial Guinea will be instrumental in helping Mozambique realize the full potential of its gas market.
“One of the key aspects of the EG LNG project is collaboration, with international oil companies (IOC) having the chance to work with nationals to scale up local content, leading to more local companies and people working at the LNG plant. This should be a key driver and initiative that should be adopted in Mozambique, partnerships between IOCs and nationals, as it will create jobs and opportunities that will ensure sustainable socioeconomic growth. Equatorial Guinea has been highly effective regarding regional cooperation. By working with other regional players including Nigeria, Cameroon, and now Mozambique, the country is driving growth on a continental scale. The AEC encourages more partnerships of this nature as well as engagements that drive LNG dialogue, LNG implementation and LNG developments. Gas will transform how we think and do business in Africa, as well as our ability to fight climate change. Gas is the pathway to fighting climate change,” Ayuk concluded.
Discussions held between H.E. President Nyusi and H.E. Minister Lima on the role African gas will play in Africa will be expanded upon during the continent’s premier energy event, AEW 2022, which takes place in Cape Town from 18-21 October.
AEW 2022 is the AEC’s annual conference, exhibition and networking event. AEW 2022 unites African energy stakeholders with investors and international partners to drive industry growth and development and promote Africa as the destination for energy investments. Key organizations such as the African Petroleum Producers Organization, as well as African heavyweights including Equatorial Guinea and Nigeria, have partnered with AEW, strengthening the role the event will play in Africa’s energy future.
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