Name of the Project
Area 1 liquefied natural gas (LNG) facility.

Location
The project proposes to develop an LNG facility on the Afungi peninsula in Cabo Delgado province, in Mozambique.

Project Owner/s
Total will be the main operator of Mozambique LNG, with a stake of 26.5%. ENH Rovuma Área Um will own 15%; Mitsui E&P Mozambique Area1 Ltd 20%; ONGC Videsh, Beas Rovuma Energy Mozambique Limited and BPRL Ventures Mozambique will each own 10%; and PTTEP Mozambique Area 1 Ltd 8.5%.

Project Description
Offshore Area 1 contains about 75-trillion cubic feet of recoverable natural gas.

The project involves the development of Mozambique’s first onshore LNG facility, comprising two initial LNG trains, with a total nameplate capacity of 12.88-million tonnes a year to support the development of the Golfinho/Atum field, located entirely within Offshore Area 1.

The project has scope to increase production to 50-million tons.

Gas from the Anadarko-operated offshore field will be sent to an onshore processing plant, where it will be liquefied and then exported.

Potential Job Creation
Area 1 has about 5 000 workers on site, progressing works associated with the construction of a resettlement village, camp expansion, an airstrip and the Palma-Afungi highway.

Capital Expenditure
$25-billion. The project will be funded with $11-billion of equity and $14-billion of debt.

Planned Start/End Date
A final investment decision was announced in June 2019, and production is expected by 2024.

Latest Developments
South Africa’s State-owned Development Bank of Southern Africa (DBSA) has confirmed financing of $120-million for the project.

On July 17, Total announced the signing of a $14.9-billion senior debt financing agreement for Mozambique LNG, revealing that the financing had been secured from eight export credit agencies, 19 commercial banks and development finance institutions.

The deal is the biggest-ever in Africa and has been closed despite rising concern about an increasingly aggressive insurgency in the Cabo Delgado province, where the project is located, as well as recent Covid-19-related delays and a sharp fall in gas prices and demand.

South African banking group Standard Bank has also confirmed that it will contribute $485-million in debt finance to the project, reporting that financing documents confirming access to the senior debt were signed on July 15.

The DBSA has said in a statement that its portion of the funding will be used towards upstream and downstream project development activities required to extract natural gas offshore and bring it onshore for processing before conversion to LNG for export to various markets.

The African Development Bank (AfDB) has also confirmed funding for the project, announcing that it has signed a senior loan of $400-million for the project.

Financial close on the project, which is proceeding despite rising concern over violence in the territory, is expected later in 2020.

The AfDB has said that the Mozambique LNG Area 1 agreement could herald a new age of industrialisation for Mozambique and could facilitate the development of gas-fired electricity for Mozambique and the region.

The bank has also emphasised that it has played a role in ensuring that the project complies with strict environmental and social standards, adding that the development is consistent with its country strategy for Mozambique, which seeks to leverage natural resource development and investment in sustainable infrastructure.

Key Contracts and Suppliers
TechnipFMC, through its subsidiary FMC Technologies (subsea trees, completion workover riser and installation workover control system, subsea controls system, subsea connectors and production manifolds); TechnipFMC, through its subsidiary Technip Mozambique and Oceaneering International (aftermarket services in Mozambique); Oceaneering International (subsea umbilicals and distribution hardware); Advanced Technology (pipeline subsea ball and subsea gate valves); Cameron Italy (subsea chemical injection metering valves engineering, procurement, construction and installation (EPCI) for the offshore subsea system); TechnipFMC and VanOord (EPCI of the offshore subsea system, engineering, procurement and construction (EPC) for the LNG facility and support facilities); and McDermott, Chiyoda and Saipem EPC contracts for the Mozambique LNG liquefaction facility and support facilities).

Contact Details for Project Information
Anadarko Petroleum Corporation investor relations Mike Pearl, tel +1832636 3271 or email mike.pearl@anadarko.com.