February 7, 2018 / 12:12 PM / a year ago

Anadarko wins approval for work on Mozambique gas project

MAPUTO, Feb 7 (Reuters) - Anadarko has received government approval to develop a gas field off Mozambique that promises to generate much-needed revenue for the impoverished country.

The Texas-based energy company plans to build a plant expected to cost around $15 billion to produce liquefied natural gas (LNG) from 2022 or 2023.

“The government has approved the resolution for the development plan for the Rovuma Basin Area 1 project to be implemented by Anadarko,” said Ana Comoana, spokeswoman of the Council of Ministers.

Governmental approval means Anadarko can begin work on the Area 1 development project, which includes installation of underwater wells, equipment to carry gas to liquefaction facilities and a storage facility with a capacity of 5.99 million tonnes a year.

“Mozambique stands to amass $30.7 billion until 2047 from taxes and profit-sharing generated from the exploitation of natural gas,” Comoana said.

Mozambique is desperate to plug gaps in government revenue after the International Monetary Fund (IMF) cancelled funding in 2016 citing concerns about how $2 billion in loans was spent.

The project is located in the Rovuma basin off the northern coast of Mozambique, where consortia led by Anadarko and Italy’s ENI are exploring. The basin boasts reserves of around 180 trillion cubic feet of gas.

Experts say the reserves are enough to supply energy to Britain, France, Germany and Italy for over 20 years. (Reporting by Manuel Mucari; writing by Mfuneko Toyana; editing by James Macharia and Jason Neely)

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