The US Export-Import Bank has approved a $5 billion loan for the Mozambique LNG project led by TotalEnergies, facilitating its revival after security concerns halted progress in 2021. TotalEnergies anticipates further support from other credit agencies. Mozambique’s Energy Minister reaffirmed confidence in UK and Dutch backing, while environmental groups highlight ongoing risks associated with the endeavor.
The Mozambique LNG project has received a significant boost as the US Export-Import Bank sanctioned a $5 billion loan to support this vital initiative led by TotalEnergies. This financial backing is crucial for the resumption of the $20 billion venture that was suspended due to security issues in 2021. Previously, a commitment of $4.7 billion was made during President Donald Trump’s administration, which has since been reassessed due to violent disruptions near the project site in Cabo Delgado province.
TotalEnergies’ CEO, Patrick Pouyanne, expressed optimism regarding the project’s funding, anticipating further endorsements from other credit agencies. This comes as the Mozambique LNG project awaits reapproval of loans from the UK and Dutch export credit agencies, following an extended halt due to a force majeure. Mozambique’s Energy Minister, Estevao Pale, conveyed confidence that the UK and Netherlands would reaffirm their support for this essential project.
Initiated in 2010, the Mozambique LNG project aims to harness vast natural gas reserves off the northern coast, estimated at around 65 trillion cubic feet (tcf). The plan encompasses the construction of two liquefaction units with an initial capacity of 13 million tonnes per annum (mtpa), with potential for growth to 43 mtpa. Until recently, progress was impeded by an insurgency linked to the Islamic State, raising serious security concerns.
Fortunately, improved security conditions have been reported, prompting partner company Mitsui to indicate that preparations to resume construction are underway as negotiations with contractors continue. However, environmental advocates have raised alarms regarding the project’s associated risks. Daniel Ribiero, a technical coordinator from Friends of the Earth Mozambique, emphasized that the human rights violations, armed conflict, environmental impacts, and questionable economic projections should deter responsible investment in the Mozambique LNG project.
The Mozambique LNG project has progressed with a $5 billion loan approval from the US Export-Import Bank, revitalizing this crucial $20 billion venture after years of suspension due to security issues. Despite optimism from TotalEnergies and government officials, concerns from environmental groups regarding human rights and environmental impacts persist. As construction preparations move forward, the backing of other credit agencies remains vital for the project’s future.
Original Source: www.offshore-technology.com
