Mozambique is likely on the brink of an economic breakthrough, owing to significant volumes of gas becoming available in the region as the liquefied natural gas (LNG) export projects in northern Mozambique come on line, says Standard Bank oil and gas head for Southern Africa Paul Eardley-Taylor.

He urged South Africa to “consider the psychological . . . and trade impact” of the LNG projects on the relationship between the two countries.

This, he said during a panel discussion hosted by Webber Wentzel earlier this week, was of particular importance as the LNG projects were raking in up to $60-billion worth of investment and could potentially employ up to 15 000 people per project.

The massive finds in northern Mozambique, according to PwC’s latest Africa oil and gas review, had already resulted in LNG project developments worth a combined $54-billion and had the potential to turn South Africa’s impoverished neighbour into the world’s third-largest LNG exporter, Engineering News Online reported earlier this month.

Advisory firm Marques Advisory’s Paris Marques shared Eardley-Taylor’s sentiment and urged South Africa Incorporated (SA Inc) to “just think about the possibilities” that Mozambique’s LNG sector presents.

The psychological impact, in particular, he told delegates, would be seen in Mozambique “asking for some respect” and localisation, especially as the LNG projects had the potential to create “limitless possibilities” in not just infrastructure, but services and agriculture in the surrounding regions.

For SA Inc, however, Marques suggested that businesses consider what they were able to do for Mozambique and provide it with, while taking Mozambique’s competency levels into account, in order to partner with local partners and create long-term sustainable investment, which is something that South Africa could benefit from, considering Mozambique’s need for growth and its geographic proximity.

However, he urged delegates and potential investors to “do as much research as possible” about what Mozambique was doing and offering before making a final decision to invest in the country.

Law firm Linklaters global energy and infrastructure group partner Francisco Ferraz de Carvalho, meanwhile, in his closing presentation, said Mozambique’s LNG opportunities would also provide domestic gas opportunities, both direct and indirect, as well as provide an opportunity for South African investors.

While it may be challenging and potential investors were urged to be cautious, he added that Mozambique was worth considering as an investment destination, if the right partners and advisers were involved in the investment process.