Economy Energy Finance Gas Infrastructure Mozambique Natural Resources

Mozambique eyes $212bn in LNG payments

The chairperson of the National Hydrocarbon Company, ENH, Omar Mitha has said the Mozambican state could gain as much as $212 billion in taxes, dividends, bonuses and other payments over the lifetime of the liquefied natural gas LNG project in Palma, APA observes here on Thursday.Addressing a media conference in Maputo on Thursday Mitha pointed out that the gains from the LNG project will depend on how many LNG factories are built.

A Consortium headed by the United States company Anadarko and by the Italian energy firm ENI have so far discovered gas reserves estimated at 170 trillion cubic feet in Rovuma Basin offshore areas where they plan to plough billions of dollars in investments.

Anadarko plans to build its liquefaction plants on land, on the Afungi Peninsula in Palma district, while ENI intends to build a floating LNG facility.

Mitha’s calculations are that, if only two LNG trains are built, payments to the state will amount to $67 billion in the project’s lifetime of up to 2035, but if six trains are built, then payments will rise to $212 billion.

With six trains, Mitha put the increase in Mozambican Gross Domestic Product (GDP) by 2035 at $39 billion and per capita GDP would rise from the 2014 figure of $650 to $4,500 in 2035, in real terms.

According to the official, from now until 2035, the project could generate 700,000 jobs assuming six trains and no construction delays, but only 16,000 of these will be jobs in the LNG industry, mostly building jobs at the peak of constructing the trains.

The rest will be indirect jobs, generated in the rest of the economy.

Mitha stressed that these figures are only projections, and so may have to be adjusted. Clearly much will depend on the international price of natural gas, which has been falling in recent months.

Mozambique has become a global magnet of foreign investors who are scrambling to tap its vast reserves of natural resources.

Source: StarAfrica

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