The Africa Report: Mozambique's Gas Fired Development

Mozambique's future as a significant energy exporter is closer to being assured following agreement on fiscal and operational terms for $40bn in foreign direct investment (FDI) to develop liquefied natural gas (LNG) facilities.

Two consortiums led by Anadarko of the US and Eni of Italy wish to develop the reserves in the offshore Rovuma Basin.

Approval of the special regime by the Mozambique authorities in December established investment conditions, most importantly stability provisions preventing terms from being changed for 30 years, although the fiscal terms can be renegotiated after 10 years.

Recoverable gas reserves for Area 1 and Area 4 of the offshore Rovuma Basin, held by Anadarko's and Eni's consortiums, stand at 120 trillion cubic feet, according to energy analysts.

Companies say that the upside for additional discoveries is considerable, making the Rovuma Basin one of the largest new global gas regions.

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