ExxonMobil Mozambique awarded to McDermott Energy Solutions a letter of intent to advance engineering and procurement work related to the first phase of Rovuma LNG, the large liquefied natural gas project planned in Mozambique.
The allocation was made on behalf of the Area 4 partners and includes limited services to continue the midstream development of the project. With this step, the companies are keeping the technical definition and planning process underway ahead of a final investment decision (FID).
Rovuma LNG is moving towards its investment decision
Specifically, McDermott participates through SMDC, a joint venture in which he works alongside Saipem, Daewoo Engineering & Construction y China Petroleum Engineering & Construction Corporation (CPECC) the consortium brings expertise in engineering, procurement, and construction of LNG facilities. This new phase aims to prepare Rovuma LNG to move toward its final investment decision, expected in 2026.
Furthermore, McDermott had already performed front-end design engineering (FEED) work for the development, allowing the company to maintain technical continuity as the project enters a new phase of preparation. Engineering related to the battery facilities, including the liquefaction modules, will be carried out from McDermott’s offices in London and Gurgaon. Meanwhile, some project management will be integrated with the joint venture team in Milan.
An LNG plant with a capacity of 18.6 million tons
Rovuma LNG it envisions a terrestrial development consisting of 12 liquefaction modules with a planned joint capacity of 18.6 million tons of LNG per year currently, the project is slated for commissioning in 2031, and the development also represents ExxonMobil’s largest single investment, according to publicly available information about the project. Furthermore, published estimates place the development cost at approximately US$30 billion however, the final figure will depend on the design and the decisions made before the FID.
The project is part of Area 4 of the Rovuma Basin, an area that concentrates significant natural gas resources off the coast of Mozambique. Mozambique Rovuma Venture, comprised of ExxonMobil, Eni and CNPC, maintains a stake of 70% in the concession, 30% the remainder is distributed among KOGAS, the National Enterprise of Hydrocarbons from Mozambique ADNOC.
ExxonMobil leads the development of Rovuma LNG
Although Mozambique Rovuma Venture operates the Area 4 concession, ExxonMobil Mozambique acts as the delegated operator for the construction and operation of the Rovuma LNG facilities.
Area 4 also houses other liquefied natural gas developments, including Coral Sul FLNG and the Coral North FLNG project this makes the Rovuma basin one of the main areas of gas expansion in Mozambique.
The projected economic impact is also considerable. Rovuma LNG could generate around US$150 billion in revenue for the Government of Mozambique over 30 years.
Furthermore, a macroeconomic study by Standard Bank estimates that the project could contribute approximately US$11 billion annually to Mozambique’s gross domestic product and generate more than 150,000 jobs.
The letter of intent granted to McDermott this keeps the technical work active prior to the final investment. The next key point will be the FID, which will determine the progress of one of the largest LNG projects planned in Africa.
Source and Photo: Offshore Energy