Mozambique is expected to become one of the world’s 10 largest producers of liquefied natural gas (LNG) in the next few years alongside Nigeria and Algeria in Africa, according to an analysis released on Tuesday by GlobalData.
“Within a few years, about 30 million tonnes per year will be extracted, due to existing deposits in the Rovuma basin, where 125 trillion cubic feet of natural gas have already been discovered,” it said.
The analysis, which is a summary of what has been written on the subject, stresses that stakeholders in the two consortia of Area 1 and Area 4 blocks will soon announce final investment decisions, with capital expenditures estimated at US$40 billion.
The natural gas deposits already discovered in the Rovuma bay consist of 75 trillion cubic feet in the Area 1 block, led by US group Anadarko Petroleum, recently purchased by US group Chevron, and 50 trillion cubic feet in the Area 4 block operated by ExxonMobil and Italy’s ENI.
Cao Chai, an oil and gas analyst, said in the document that the break-even of projects in Mozambique, estimated at US$4 to US$5 per thousand cubic feet, is very competitive when compared to prices in Japan’s spot market of US$9.24 per thousand cubic feet, due to a much lower capital cost of similar projects in other parts of the world. (Macauhub)