TotalEnergies is finalizing $15 billion in financing for its Cabo Delgado LNG project, supported by the U.S. Exim Bank’s $4.7 billion confirmation. The project has been on hold since 2021 due to security issues, but improvements in safety have spurred hopes for a restart. TotalEnergies holds a 26.5% stake, and the project is part of Mozambique’s extensive gas exploration plans.
TotalEnergies is nearing the finalization of $15 billion in financing for its natural gas exploration project in Cabo Delgado, Mozambique. This follows a crucial support decision from the U.S. Export-Import Bank (Exim), which reaffirmed its commitment to the project. Despite being in a situation of force majeure, TotalEnergies aims to restart operations as security in the region improves.
The director of TotalEnergies for Mozambique, Maxime Rabilloud, highlighted the significance of Exim Bank’s confirmation of $4.7 billion for the project. The company leads the Area 1 consortium undertaking a liquefied natural gas (LNG) plant construction in Afungi. The project has been on hold since 2021 due to terrorist attacks, which prompted TotalEnergies to declare force majeure.
The financing consortium includes participation from various international banks, with a total of $15 billion set for the project, of which Asian banks have confirmed $5 billion. As of now, only reconfirmation from European banks is pending. TotalEnergies’ CEO, Patrick Pouyanne, had estimated that LNG production might be delayed until 2029-2030, citing recent setbacks.
In discussions with Mozambican President Daniel Chapo, Pouyanne assured TotalEnergies’ commitment to resume the project, acknowledging that security conditions in Cabo Delgado have improved, although issues remain. The project, intended primarily for Asian markets, halted in 2021 after a violent attack that caused civilian fatalities. TotalEnergies possesses a 26.5% stake in this initiative, alongside partners from Mozambique and the Japanese firm Mitsui, which holds a 20% stake.
Mozambique’s offshore Rovuma Basin houses three significant gas development projects, recognized among the largest globally, signaling substantial economic potential for the region.
In summary, TotalEnergies is close to securing its $15 billion financing for the revitalization of the LNG project in Cabo Delgado, Mozambique, contingent on improved security measures. The initiative is supported by both international financial institutions and local partners, although the project remains in limbo due to past terrorism. Future developments depend on the ongoing stabilization of the region and solidification of financing commitments from European banks.
Original Source: clubofmozambique.com
