The Director of Projects and Development at the National Petroleum Institute, Nazário Bangalane, argues that Mozambique’s natural gas can be used as an alternative in the world energy transition process.

Nazário Bangalane was speaking to Radio Mozambique after participating in a panel that discussed in Stockholm, Sweden, the theme “Just Transition – The Path to a Healthy Planet for the Prosperity of All”.

“Studies point out that natural gas, in fact, will continue to play a fundamental role for a considerable period, taking into consideration that we are dealing with a less polluting hydrocarbon. Therefore, the great discoveries of natural gas in the Rovuma basin assure a privileged place for Mozambique in the global market and its commercialization is opportune, using this window of energy transition that is being talked about worldwide and mainly here in this Stockholm conference”, he stated.

Bangalane also mentioned that the oil companies operating in Mozambique have joined global initiatives for the elimination or reduction of carbon emissions into the atmosphere.

A report by the research company Bloomberg, states that global investment in the energy transition totaled a record seven hundred and fifty-five billion dollars in 2021.

The same document stresses that to achieve carbon neutrality goals, investments must be tripled by two thousand and twenty-five.

The Stockholm International Climate Conference, an event co-organized by the governments of Kenya and Sweden, ended this Friday.

The representative of the National Petroleum Institute (INP), Natália Camba, speaking at the Conference and Exhibition on Mining, Oil, Gas and Energy, advanced that in a horizon of 20 years, Mozambique may collect, in revenues, up to 100 billion dollars.

Camba argues that the banking sector should create subsidized credit lines, so that Small and Medium Enterprises (SMEs) can respond to opportunities in the oil and gas sector.

In recent years alone, the sector has raised about $50 billion, and the appetite of SMEs for opportunities in the oil and gas industry is growing.

The National Petroleum Institute, also calls on banks to actively finance domestic companies to be eligible to be part of the natural gas chain.

“Credit is high, so the bank has an important role in this process of access to financing, and there are many options carried out by many entities in which the bank participates, creating some working capital,” clarified the INP representative.

According to ENI’s Technical Director Ivan Codgnotto the implementation of the Coral Sul project is proceeding according to the original plan and the Gas will start to be loaded in the second half of this year.

In a presentation that took place last June 2, during the MMEC conference the Technical Director of ENI, made a very positive point regarding the implementation schedule of the Coral FLNG project.

“Not even the challenges that the pandemic brought at all levels, delayed operations in the various countries”, which according to the representative “demonstrates the resilience of the partnership of the Area 4 consortium led by ENI”, he added.

“We have had several difficulties in the past few years, but despite this the project has remained on schedule,” Codognotto noted. “We are committed to deliver Gas in the second half of 2022,” he promised, also referring to the important role that had the support of the Government of Mozambique, the Authorities and the Mozambican People.

Area 4 Consortium

The Area 4 exploration consortium, a 13,235 km² field in ultra-deep waters, is composed of the following entities and percentages:

Mozambique Rovuma Venture (MRV) – 70% (divided by ExxonMobil 35.7%, ENI – 37.5% and CNPC – 28,6%)

Galp – 10%.

Kogas – 10%.

ENH – 10%.

The Coral Sul project

The Coral Sul project consists of the construction of a floating natural gas liquefaction unit (FLNG) that will be allocated in the southern part of the Coral discovery, which is exclusively located in Area 4, which contains about 16 tcf of natural gas.

The floating unit will have a capacity of over 3.4 million tons per year (mtpa) of liquefied natural gas (LNG), and will be connected to six wells.

The Final Investment Decision (FID) on the project was made by the consortium in 2017, and the partners signed the Engineering, Procurement, Construction, Installation and Commissioning (EPCIC) contract for the FLNG unit with the TJS consortium (Technip, JGC, Samsung).

The total investment for the upstream and midstream development is estimated at $7 billion (bn) and the start of production is expected in the second half of 2022. The consortium for Area 4 has also secured $5 bn in project financing with a syndicate of ECAs (export credit agencies) and international financial institutions.

In October 2016, the consortium signed an agreement with BP to sell the total volumes produced through the FLNG unit in South Coral for a period of 20 years.

Milestones of the South Coral project

October 2016, the consortium signed an agreement with BP for the sale of the total volumes produced through the FLNG unit in South Coral for a period of 20 years;

Final Investment decision was reached in June 2017;

Construction of the FLNG facility commenced in September 2018 in South Korea;

Simultaneously drilling activities of 6 wells in ultra-deep water (2000 meters) in Mozambique were taking place;

FLNG platform arrived in Mozambican territorial waters on January 3;

Docking process completed by early March 2022;

Offshore commissioning is in progress;

Connection of wells’ hoses and umbilicals completed in May;

First LNG shipment planned for second half of 2022.

Coral Field Figures

2012 (May) – Coral field discovery

85 Trillion ft3 (2.4 Trillion m3)

1st deepwater FLNG project in the world

8 Billion USD investment

1,500m and 2,300m deep

150 miles (241.4km) northwest of Pemba

30 miles (48.2km) off the coast of Mozambique

The floating platform Coral FLNG:

432 meters long

66m wide

220.000 Tons

Accommodates up to 350 people

Handles up to 3.4 MPTA

Resources

ExxonMobil

ENI

GALP

Kogas

CNPC

ENH

Mozambique Rovuma Venture