Anadarko Takes Mozambique LNG Final Investment Decision

Published Jun 18, 2019 8:34 PM by The Maritime Executive

Anadarko Petroleum Corporation have announced a Final Investment Decision (FID) on the Anadarko-led Area 1 Mozambique LNG project. The $20 billion gas liquefaction and export terminal in Mozambique will be the largest single LNG project approved in Africa.

The Anadarko-led Area 1 Mozambique LNG project will be Mozambique's first onshore LNG development, initially consisting of two LNG trains with total nameplate capacity of 12.88 million tonnes per annum (MTPA) to support the development of the Golfinho/Atum fields located within Offshore Area 1. The project has successfully secured in aggregate 11.1 MTPA of long-term LNG sales (representing 86 percent of the plant's nameplate capacity) with LNG buyers in Asia and in Europe. Additionally, the project is expected to have a significant domestic gas component for in-country consumption to help fuel future economic development. 

The Anadarko-led Area 1 Mozambique LNG project has been designated as "First Mover" by the Government of Mozambique, meaning Area 1 will also be responsible for constructing the support facilities to be shared between Area 1 and Area 4 projects, which will include the Materials Offloading Facility and the LNG Marine Terminal. In addition, Area 1 has approximately 5,000 workers on-site already progressing works associated with the construction of a resettlement village, camp expansion, airstrip, and Palma-Afungi Highway.

Jon Lawrence, an analyst with Wood Mackenzie’s sub-Saharan Africa upstream team, said: “Mozambique LNG is one of two LNG mega-projects that have been seeking sanction for over four years in Mozambique. “The other is the ExxonMobil-led Rovuma LNG development. With strong LNG demand growth out of Asia, now is Mozambique’s time."

He added: “We believe that, from the early 2030s, state revenue from Mozambique LNG alone will reach $3 billion per annum, single-handedly doubling today’s revenue, as calculated by the IMF and World Bank.” Lawrence said that Wood Mackenzie expects the two Mozambique LNG projects to be the second and third most valuable oil and gas sanctions taken this year, after Arctic LNG-2 in Russia. 

Contractor Selections

• TechnipFMC – through its subsidiary FMC Technologies, Inc. - Subsea trees, completion workover riser and installation workover control system, subsea controls system, subsea connectors and production manifolds
• TechnipFMC – through its subsidiary Technip Mozambique, Lda. - Aftermarket services in Mozambique
• Oceaneering International, Inc. – subsea umbilicals and distribution hardware
• Oceaneering International GMBH – Aftermarket services in Mozambique
• Advanced Technology Valve S.p.A. – pipeline subsea ball and subsea gate valves
• Cameron Italy, S.R.L. – subsea chemical injection metering valves
• TechnipFMC and VanOord – for the engineering, procurement, construction and installation of the offshore subsea system
• A consortium consisting of McDermott, Chiyoda and Saipem (CCS JV) – the engineering, procurement and construction contracts for the Mozambique LNG liquefaction facility and support facilities.

Anadarko Moçambique Área 1, Lda, a wholly owned subsidiary of Anadarko Petroleum Corporation, operates Offshore Area 1 with a 26.5 percent working interest. Co-venturers include ENH Rovuma Área Um, S.A. (15 percent), Mitsui E&P Mozambique Area1 Ltd. (20 percent), ONGC Videsh Ltd. (10 percent), Beas Rovuma Energy Mozambique Limited (10 percent), BPRL Ventures Mozambique B.V. (10 percent), and PTTEP Mozambique Area 1 Limited (8.5 percent).

Anadarko has agreed to be taken over by Occidental Petroleum Corp. Once that deal goes ahead, Occidental has agreed to sell assets including the Mozambique LNG project to Total, reports Reuters.