Total and Mitsui have signed a USD 14.9 Bi senior debt financing agreement for Mozambique LNG, the country’s first onshore LNG development.
Mozambique LNG represents a total post-FID investment of USD 20 Bi. The project financing amounts to USD 14.9 Bi, the biggest ever in Africa, and includes direct and covered loans from 8 Export Credit Agencies (ECAs), 19 commercial bank facilities, and a loan from the African Development Bank.
According to a statement, the ECAs participating in the financing include Export Import Bank of the United-States (US-Exim), Japan Bank for International Corporation (JBIC), Nippon Export and Investment Insurance (NEXI), UK Export Finance (UKEF), Servizi Assicurativi del Commercio Estero of Italy (SACE), Export Credit Insurance Corporation of South Africa (ECIC), Atradius Dutch State Business (Atradius), Export-Import Bank of Thailand (EXIM Thailand).
The project includes the development of the Golfinho and Atum natural gas fields located in Offshore Area 1 concession and the construction of a two-train liquefaction plant with a total capacity of 13.1 million tons per annum.
Jean-Pierre Sbraire, Chief Financial Officer of Total, said in a statement that “the signing of this large-scale project financing, less than one year after Total assumed the role of operator of Mozambique LNG, represents a significant achievement and a major milestone for the project”. “It demonstrates the confidence placed by the financial institutions in the long-term future of LNG in Mozambique”.
Total E&P Mozambique Area 1 Limitada, a wholly owned subsidiary of Total SA, operates Mozambique LNG with a 26.5% participating interest alongside ENH Rovuma Área Um, S.A. (15%), Mitsui E&P Mozambique Area1 Limited (20%), ONGC Videsh Rovuma Limited (10%), Beas Rovuma Energy Mozambique Limited (10%), BPRL Ventures Mozambique B.V. (10%), and PTTEP Mozambique Area 1 Limited (8.5%).
Total acquired its 26.5% operated interest in the Mozambique LNG project from Anadarko for USD 3.9 billion in September 2019.
According to Total, the Mozambique LNG project is largely derisked since almost 90% of the production is already sold through long-term contracts with key LNG buyers in Asia and in Europe. Additionally, the project is expected to have a domestic gas component for in-country consumption to help fuel future economic development.
Photo: Mozambique LNG