Partners in Mozambique LNG, the US$20B gas project led by Total, have received a US$2.25B guarantee from the government that it will pay the state oil company’s equity share if required, Portugal’s Lusa news agency said.
Carlos Zacarias, president of Mozambique’s regulator, the National Petroleum Institute (INP), said state financing had been secured, the news agency reported late last week.
Partners agreed to accept a US$2.25B government guarantee in lieu of an immediate equity contribution from state-run National Hydrocarbon Company (ENH), Zacarias said in Cabo Delgado, the northern province where the project is sited.
Zacarias said the guarantee was valid for five years.
A spokesman for ENH did not immediately respond to a request for comment and INP could not immediately be reached. A Total spokesman in Mozambique said he had no information on the report.
Each partner in the project, one of several LNG developments in the region following a massive gas find off Mozambique’s coast, is required to make a minimum capital contribution.
ENH has a 15% interest in the project that is expected to start production in 2024, while Total owns 26.5% after acquiring its stake from Anadarko for US$3.9B in 2019.
The French energy major has secured US$15B in funding for the project. Signing for the financing is due to take place on June 30, a source with knowledge of the project said.