Mamba LNG To Proceed, Even If Not Presold: Eni
A senior Eni executive has said that all partners in the planned Mamba LNG project in Mozambique are ready to sanction it – even if not all its volume is committed to third parties.
Eni said in its 2Q results that it expects a final investment decision (FID) for Mamba LNG in 2019. That onshore Mozambique liquefaction project, sometimes called Rovuma LNG, is to be operated by ExxonMobil and fed by offshore Area 4 gas.
In a call to analysts about its 2Q results on July 27, Eni gas and LNG marketing chief Massimo Mantovani said there had been a recent marketing meeting of all Mamba LNG partners, including operator ExxonMobil. At the meeting held in Washington DC, according to the Eni executive: “We all agreed that, basically, marketing will not be a critical element. Everybody is ready to offtake production and to ensure that the final investment decision is taken, irrespective of the fact that not all the LNG has been sold to third parties. Some of this LNG will go into [partners’] portfolio. Some will be sold. Nevertheless, all the partners are ready to take it up,” Mantovani concluded.
In its 2Q results statement, ExxonMobil said that it continues in active negotiations on binding sales and purchase agreements for the project. Earlier this month, it announced that Mamba/Rovuma LNG venture had submitted its first phase development plan to Mozambique's government, which is based on two onshore liquefaction trains that would will each produce 7.6mn metric tons/year of LNG.
US rival Anadarko, with its Area 1 gas partners, said in March that the government had approved its submission of its ‘Mozambique LNG’ project’s phase 1 development of a two-train LNG complex.
The separate Exxon and Anadarko-led ventures are to share an onshore site at Afungi in northern Mozambique that they have said might eventually host up to 50mn mt/yr of liquefaction capacity. Neither project is short of gas: Area 4 has around 85 trillion ft3 of gas in place, while Area 1 has a further 75 trillion ft3. Industry standards allow 1 trillion ft³ of reserves for 1mn mt/yr of LNG for 20 years.
If these initial projects take FID next year, initial LNG exports may follow in 2023 or 2024. The already-sanctioned offshore Eni-run Coral floating LNG project, on Area 4, is expected to start exports in 2022.