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Positive FID taken on Area 1 Mozambique LNG project

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LNG Industry,

Anadarko Petroleum Corp. has released a statement announcing that a positive final investment decision (FID) on the Area 1 Mozambique LNG project has been taken.

According to the statement, this FID confirms that the Area 1 Plan of Development is now effective, with notice provided to the Government of Mozambique that all conditions precedent have been fulfilled, and the project can now progress to the construction stage.

President Filipe Nyusi said: “This is a historic day for the people of Mozambique.

“Today’s sanctioning of the Anadarko-led Area 1 Mozambique LNG project solidifies a path toward the creation of thousands of jobs for our people, significant economic growth for our nation, and the potential to be one of the world’s largest providers of cleaner energy for decades to come. It is truly one of the most important and transformational projects in our country's history.”

Anadarko Chairman and CEO, Al Walker, added: “This is an exciting day for Mozambique and for our partnership, bringing us a step closer to making Mozambique's first onshore LNG facility a reality.

“The Anadarko-led Area 1 Mozambique LNG project has come a long way from our first discovery to FID for the construction of the initial two-train development project. I want to say a collective ‘thank you’ to the world-class LNG team we have assembled at Anadarko, our co-venturers, long-term foundation customers, lenders, the people of the Cabo Delgado region, and the Government of Mozambique. As the world increasingly seeks cleaner forms of energy, the Anadarko-led Area 1 Mozambique LNG project is ideally located to meet growing demand, particularly in expanding Asian and European markets. We look forward to safely executing the next phase of this project for the long-term benefit of Mozambique, its people, our partnership, and our customers.”

The project will be Mozambique’s first onshore LNG development. It will initially consist of two LNG trains, with a total nameplate capacity of 12.88 million tpy, and will support the development of the Golfinho/Atum fields, which are located entirely within Offshore Area 1. Anadarko claims that the project has successfully secured in aggregate 11.1 million tpy of long-term LNG sales (representing 86% of the plant’s nameplate capacity), with key LNG buyers in Asia and in Europe. In addition to this, the project is expected to have a domestic gas component for in-country consumption to help fuel future economic development.

According to the statement, the project has been designated ‘first mover’ status by the government of Mozambique. This means that Area 1 will also be responsible for constructing the support facilities to be shared between Area 1 and Area 4 projects, which will include the materials offloading facility and the LNG marine terminal. In addition to this, Anadarko claims that Area 1 currently has approximately 5000 workers on site today, progressing works associated with the construction of a resettlement village, camp expansion, airstrip and Palma-Afungi Highway.

The project expects that it will soon issue notices to proceed under the terms of the previously executed engineering, construction, procurements and installation contracts. It also expects to finalise financing soon.

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