Big projects, big opportunities

Neil Golding, EIC

November 1, 2016

EIC’s Neil Golding outlines activity in East and South Africa.

Houston-based independent Anadarko made its first gas discovery at the Offshore Area 1 block offshore Mozambique in 2010. The discovery, along with Eni’s major finds, mean that the country has the proven resources to become a major global player in the gas market. Combined, the resources could amount to 160 Tcf of recoverable gas.

Due to the significant resources, LNG plants were proposed to allow for gas to be exported to regional and global demand centers. Two projects were consequently proposed: an onshore liquefaction plant that will consist of two onshore LNG trains and have a combined capacity of 10 MTPA, and a floating LNG project to develop the Coral field, which will have a capacity of 3.4 MTPA and on which progress has been made very recently and could see gas exported by 2021.

In February 2016, the development plan for the Coral field was approved by the government, with a final investment decision (FID) expected at the time of September 2016 at the earliest. During October 2016 a supply deal was signed with BP, which agreed to offtake the total capacity of the Coral FLNG, a significant step for the project to proceed (Read more: LNG a-go-go).

With such a commitment the expectation (at the time of writing) is that the FID will be made imminently and the formal award of the EPC contract will be made to the joint venture comprising of Samsung Heavy Industries, Technip and JGC. This will also mark the first major development of the country’s vast offshore gas resource.

The Anadarko discoveries will move forward as two separate developments. Combined, the Golfinho/Atum and Prosperidade developments were, in 2015, expected to require a capex of US$24 billion, however, given the current climate it is expected that this figure will be reduced prior to FID being reached. The FID for these developments is expected to be made in 2017 although this has been pushed back several time from the originally expected FID date of Q4 2014. The development of Prosperidade is understood to be further advanced, the first phase of which will see the production of 2 Bcf/d of gas sent from up to 16 wells to shore via three, 22in diameter pipelines to the onshore LNG liquefaction plant.

With a limited local oil and gas related supply chain, these offshore developments, along with associated onshore developments, will offer the international supply chain plentiful opportunities in the future.

Neil Golding is head of Oil and Gas and Business Development for the EIC. He has over 16 years’ experience working in the oil and gas industry in various roles.