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Afreximbank commits $400 million to Mozambique LNG project

Mozambique LNG is one of several projects being developed in the country’s northernmost province of Cabo Delgado after one of the biggest gas finds in a decade off its coast

The Cairo-based African Export-Import Bank has committed $400 million in loans and guarantees to Mozambique’s $20 billion liquefied natural gas (LNG) project, the multilateral lender has said.

Afreximbank’s move follows a similar commitment for the same sum by the African Development Bank last month.

“The … financing will be used to partially finance … activities required to extract natural gas offshore, its transfer to onshore processing facilities and then its conversion to LNG for export … around the world,” the Afreximbank statement said.

The Mozambique LNG Area 1 Project is ranked Africa’s single largest foreign direct investment to date. It will consist of two LNG trains with a total capacity of roughly 13 million tonnes a year.

Total has secured a $14.9 billion senior debt agreement, the biggest project financing Africa has seen.

The project includes the development of the Golfinho and Atum natural gas fields in the Offshore Area 1 concession and the construction of a two-train liquefaction plant with a capacity of 13.1 million tonnes per year, Total said.

Complex financing

Mozambique LNG’s project financing includes direct and covered loans from eight export credit agencies (ECAs), 19 commercial bank facilities, and a loan from the African Development Bank (AfDB).

ExxonMobil delayed the final investment decision on its Rovuma LNG gas project because of the coronavirus pandemic, and Mozambique expects the decision next year.

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