Postponement of the decision to invest in Mozambique by ExxonMobil reduces FDI in 2020

14 April 2020

The postponement of the final investment decision for the Area 4 block, in the Rovuma basin, northern Mozambique, will have implications on the amount of foreign direct foreign investment (FDI) planned for the country this year, said the president of the National Oil Institute.

Carlos Zacarias said, however, he was convinced that once the impact of Covid-19 and market conditions have been overcome or come under control we will see the acceleration of investments for these projects to go ahead.

The ExxonMobil group announced last week that the final investment decision for the Rovuma LNG natural gas project, in Mozambique, which was scheduled for this year, has been postponed.

The statement added that the Coral LNG development project continues as planned.

The group’s decision was intended to reduce investment spending by 30%, or US$10 billion, a measure related to the low prices of energy products as a result of the fall in demand.

The company also announced it was reducing current expenditure by 15% to, “survive this period of downturn in consumption.”

The Rovuma LNG project, which will extract natural gas from a deepwater block on the coast of Mozambique that contains more than 85 trillion cubic feet of natural gas, was due to receive the final investment decision in the first half of 2020.

The Area 4 block’s participants are Mozambique Rovuma Ventures, a partnership owned by ExxonMobil, ENI and the China National Petroleum Corporation, which together control 70% of the holding, with the remaining 30% split into equal parts between Portuguese group Galp Energia, South Korea’s Kogas and Mozambican state oil company ENH. (macauhub)