Africa Energy FA FDI FID Gas Infrastructure Investing Mozambique South Africa

Sasol to invest US$760M in Mozambique

South African state oil company Sasol will invest US$ 760M in the exploration of natural gas in the concession which it holds since 2004 in Inhambane, southern Mozambique, the company announced yesterday together with the Mozambican government.

The oil company has made a “final investment decision for the development of additional natural gas reservoirs” in the Inhassoro district, alongside the Pande and Temane gas deposits it already operates, the Ministry of Mineral Resources and Energy said in a statement.

The investment will serve to produce 30,000 tons of cooking gas per year in what will be the first unit of its kind in the country.

It will also generate 450 megawatts of electricity at the Temane combined cycle plant, energy to be injected into the Mozambican network.

Also read: Sasol agrees on Mozambique gas plant sale in latest disposal

The project also contemplates the production of 4,000 barrels of light crude oil per day for export.

The Government expects that Mozambique will stop importing about 75% of the current volume of cooking gas and expects that there will be a widespread use of cooking gas, contributing to the reduction of deforestation for consumption as fuel.

Construction of the infrastructure is due to start in July and will employ around 3,000 Mozambicans, in addition to “thousands of indirect jobs over the next three years”, adds the Government.

The Sasol project in the province of Inhambane, southern Mozambique, has been operating for 17 years with export made possible by a pipeline connecting to South Africa, and is currently the only hydrocarbon exploration project in the country.

In the Rovuma basin, in the north of the country, megaprojects of natural gas are expected to start production in 2022 (Eni) and 2024 (Total).

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