US oil company Anadarko is due on Tuesday to formally announce its investment plan for exploration of natural gas in Mozambique.
The development plan for Area 1 of the Rovuma Basin in Cabo Delgado province is estimated to cost US$25 billion to prospect for natural gas that will latter be channeled to a plant that will transform it into liquid on the Afungi peninsula, in the district of Palma.
Alongside the liquefaction plant a dock will be built for special cargo ships to be filled with liquefied natural gas (LNG).
According to daily newspaper Notícias, a smaller portion of LNG will remain in Mozambique, which will be channeled to electricity production, and transformed into liquid fuels and fertilisers.
The Area 1 plan initially projects two gas liquefaction lines with a total production capacity of 12.88 million tonnes per year (mtpa), and the project may increase to up to eight production lines.
Area 1 has more than 75 trillion cubic feet (tcf) of off-shore gas deposits.
Anadarko believes that the Area 1 deposits are equivalent to double the gas and oil, available in the British North Sea area and classifies the Rovuma basin as the next large hydrocarbon exploration zone in the world.
In addition to Anadarko, which leads the consortium with 26.5%, the group exploring Area 1 consists of Japan’s Mitsui (20%) and Mozambican state oil company ENH (15%), with smaller stakes held by India’s ONGC (10% ) and its subsidiary Beas (10%), Bharat Petro Resources (10%) and Thai company PTTEP (8.5%).
Anadarko is expected to hand over the leadership of the consortium to France’s Total by the end of the year, after being bought by another US oil company, Occidental, which in turn entered into an agreement to sell assets in Africa.
Natural gas projects in Mozambique are expected to go into production in about five years and drive the Mozambican economy to grow by more than 10% a year, according to the International Monetary Fund. (Macauhub)