Indian hopes for a natural gas bounty from its offshore holdings in Mozambique have been put off until 2022. ONGC Videsh, Oil India and Bharat Petroleum control 30% of the Rovuma Area 1 offshore gasfield with proven reserves of 75 trillion cubic feet. It had originally been hoped gas production would start by 2019.
The reasons for the delay seems to be threefold. Political and economic instability in Mozambique has slowed down decision making in the country. The other consortium partners are unenthusiastic about fast tracking production at a time when global gas prices are at an all-time low. Finally, the liquefied natural gas terminal needed to transfer the gas shows no signs of being constructed, partly because of the costs involved. “We expect a delay of at least two years,” said managing director OVL, N. K. Verma, in the Economic Times.
Meanwhile, Essar Ports announced in January that it would be building a new coal terminal in Mozambique following the completion of a rail link from the coast to interior coal mines.
The same month Standard Chartered and a consortium of financiers announced they had secured multi-billion-dollar funding to build a floating LNG complex for Mozambique and kickstart the country’s long-awaited shift towards being a major energy exporter.
January 31, 2018