September 14, 2022


Mozambique's Leader Calls for More Progress on Stalled LNG Projects

The president of Mozambique, Filipe Nyusi, says he expects work to resume on the suspended $20 billion Mozambique LNG project, led by TotalEnergies, now that security is improving in the northeastern region of Cabo Delgado. The region has been ravaged in recent years by a bloody insurgency.

“The terrorists are on the run,” Nyusi told a conference in Maputo Wednesday organized by DMG Events, pointing out that at least 10,000 people returned last week to the port of Palma, which is adjacent to the project site on the Afungi Peninsula.

But the vice-president of the 13.18 million ton per year Mozambique LNG project, Stephane Le Galles, said there was still work to do before the force majeure, that was introduced in April last year, could be lifted. He agreed that the situation in Cabo Delgado was better, having visited the region two weeks ago. But he would not offer a date for a restart.

“The signs are obvious of people coming back to the region, but we are not there yet,” he said. “The journey is long and the direction is good."

Mozambique LNG

Mozambique LNG, Africa’s largest ever energy project, is central to Mozambique’s ambition to become a top LNG exporter. The original plan was for the plant, which will be fed with gas from Deepwater Area 1, to come into operation in 2024. But the force majeure has pushed back the schedule by at least two years.

The project is underpinned by some $15 billion in loan commitments from multiple lenders, including $4.7 billion pledged by the US Export-Import Bank and $3 billion from the Japan Bank for International Cooperation.

Total is operator of the project with a 26.5% interest, alongside Mozambican state oil company ENH with 15%, Japanese duo Jogmec and Mitsui with 10% apiece, India’s Bharat, Oil India and ONGC sharing 30% and Thailand’s PTT with 8.5%

Le Galles said Total and its partners are working closely with the government, local authorities and several non-governmental organizations (NGO) in a “massive” campaign to bolster the region’s economic development and provide humanitarian help, including new homes, for people displaced by the violence.

“The success of such a mega project is produced from the participation of the local people,” he stressed, citing progress that has already been made in improving health and education facilities.

Rovuma LNG

President Nyusi, who is midway through his second and final five-year term, also called on the partners in offshore Area 4, led by ExxonMobil and Eni, to make a final investment decision (FID) on the Rovuma LNG project, which is also based in Cabo Delgado, “as soon as possible.”

Jos Evens, head of Exxon Mobil’s operations in Mozambique, told the conference that FID on the $23 billion project was deferred in 2020 and that he would not be drawn on when the US major, which would oversee construction of the 15.2 million ton per year complex, might fire the starting gun.

He said Exxon and its partners have been working on “optimizing” the original concept for the project, for the sake of flexibility, and are also discussing the possibility of having a second floating LNG scheme -- to complement the existing one now being used by the Area 4 concessionaires for the Eni-led Coral South project -- though he said no decision had been made on this.

Exxon continues to monitor the security situation in Cabo Delgado and stressed there “are challenges and obstacles that need to be overcome.”

Eni and Exxon Mobil each have a 25% stake in Area 4, China National Petroleum Corp. with 20%; and Mozambique’s state oil company ENH, Korea Gas and Portugal’s Galp, all with 10% each.

Coral South

Coral South FLNG, the smallest of Mozambique’s three LNG projects with a 3.4 million ton per year capacity, is just months away from making its first shipment.

Eni executive Giogio Vicini would not give a specific date but said start-up of the floating liquefaction project would happen by the end of this year and said the project would come in on schedule and on budget.

All the LNG from the project is committed to BP under a long-term offtake contract.
Paul Sampson, Maputo

Russia's Yatec Presses On With Yakutia LNG

Yatec has not scrapped the Yakutia LNG project despite financial and technology sanctions against Russia, a company representative told the St. Petersburg International Gas Forum on Wednesday.

“This project is definitely in development, moving ahead. We haven’t stopped,” Yatec’s project office director Airat Khusainov said.

Controlled by private Russian company A-Property, Yatec continues with exploration to build up a resource base for the 18 million ton per year project, he said.

The project was listed among Yatec’s strategic priorities in the company’s annual report published a little over two months ago, but Yatec had provided no status update for the project since then.


Russian LNG projects face delays, or even cancellation, after the EU imposed a ban on the export of key liquefaction technology to the country in April and many Western investors and engineering contractors decided to withdraw from Russia.

It is not clear how the sanctions affected Yatec’s planned project schedule. Last year, its CEO Andrei Korobov said in an interview with Energy Intelligence that the company expected to make a final investment decision on Yakutia LNG in early 2023 and start the 9 million ton/yr Phase 1 in 2027.

Russia’s overall LNG export ambitions are thought to be at risk. The country intends to increase LNG exports to between 80 million and 140 million tons/yr by 2035, up from around 30 million tons in 2021.

Russia’s LNG export champion Novatek believes the national target is still achievable if companies rely on domestic technology and equipment, still to be developed, while state-run gas giant Gazprom says the LNG targets and all proposed projects should be reviewed in the new reality.

Proposed Yakutia LNG

lngi211103-Ayan Yakutia.svg


Yatec focuses on the resource base, while another A-Property subsidiary, Globaltec, is in charge of the 1,358 kilometer gas pipeline that should take Yatec’s gas from the republic of Sakha (Yakutia) to the future LNG plant’s location in the coastal Ayan village in the Khabarovsk region, Khusainov said (see map above).

Exploration spending totaled around 3.8 billion rubles ($64 million) in 2021, Khusainov said.

Yatec’s proved reserves now amount to around 600 billion cubic meters, he said. That should be enough to feed Yakutia LNG’s Phase 1, while to add Phase 2 the company needs to expand the reserves to 1 Tcm, which it plans to do by 2026.

For more coverage of the Ukraine crisis, visit Ukraine Crisis: Energy Impact

Staff Reports

Portovaya LNG Loads First Cargo, Destination Unknown

Russian state-owned exporter Gazprom has loaded the first LNG cargo from its 1.5 million ton per year Portovaya plant, located on Russia’s Baltic Sea coast.

Gazprom said earlier in September that Portovaya had produced its first volumes of LNG and completed 72-hour tests, which usually marks the end of the commissioning stage.

The first cargo from the plant was lifted by the 170,200 cubic meter Pskov on Sep. 13, people close to the matter confirmed to Energy Intelligence.

However, the vessel has stopped after leaving the plant and is currently waiting outside the facility, ship-tracking data from energy analytics firm Kpler shows.

Destination Unknown

Energy Intelligence has received contradictory information regarding the vessel’s destination in recent days. It was first understood that the Pskov would deliver the cargo to the Russian exclave of Kaliningrad, further south along the Baltic coast, but new information on Wednesday suggested that the vessel will unload at Greece’s Revithoussa terminal.

On the other hand, AIS signals from the vessel on Tuesday night showed that its next destination is Port Said in Egypt, the Mediterranean entrance point of the Suez Canal.

Signaling Port Said usually indicates that the vessel will transit the Suez Canal to deliver its cargo to Asia.

The lack of destination clarity could potentially be due to the reluctance of certain purchasers to make high-profile purchases of Gazprom supplies in the wake of the Ukraine invasion, or perhaps the lack of clarity is simply due the volatile nature of the current market.

Russian LNG Buildout

Portovaya was initially planned to start operations in 2018 but construction was delayed several times. The plant started the commissioning stage in late 2021.

Portovaya's 1.5 million tons of capacity adds to Russia’s existing capacity of around 30 million tons/yr.

The next capacity addition should come in late 2023, when privately owned Novatek plans to launch the almost completed first 6.6 million ton/yr train of the 19.8 million ton/yr Arctic LNG 2 project.

Russia seeks to expand LNG production to between 80 million and 140 million tons/yr by 2035, as it needs to diversify gas exports amid Europe’s plans to phase out Russian pipeline gas imports by 2027. But that target might be clouded by EU technology sanctions banning exports of key liquefaction equipment for Russian LNG projects and the withdrawal of western investors and engineering contractors.
Daniel Stemler, Madrid

Data Snapshot

LNG Netbacks at Key Receiving Terminals

LNG Exporter Netbacks Between Key Receiving Ports
($/MMBtu)AlgeriaAustralia WestAustralia EastMalaysiaNigeriaNorwayOmanPeruQatarRussiaTrinidadUS GulfUS East Coast
Dahej, India38.8239.2938.8639.2838.4338.2739.7937.8739.6938.9138.1037.8038.17
Sodegaura, Japan39.4240.8940.9041.0039.3635.6840.4838.1940.3441.3838.5837.6539.56
Zeebrugge, Belgium62.2260.2159.6960.3261.5962.0261.1459.7360.9859.7461.7360.5761.84
Huelva, Spain34.2132.5532.1532.6433.6633.4533.3132.0533.1932.1733.7232.6833.73
Isle of Grain, UK41.0839.3038.8639.3940.5640.9140.2538.8739.9938.8940.6639.6440.76
Everett, US6.895.405.735.476.606.460.016.185.975.067.08----
Created with Highcharts 9.0.0($/MMBtu)QATAR TO NORTHEAST ASIANetbackNetback11. Apr25. Apr9. May23. May6. Jun20. Jun4. Jul18. Jul1. Aug15. Aug29. Aug12. Sep10203040506070Energy Intelligence

LNG Market Indicators

Spot LNG Pricing
Latest WGIDailyDaily Chg.Chg. From Latest WGI
NE Asia42.0042.140.140.14
SW Europe37.7534.88-2.87-2.87
Futures Pricing
($/MMBtu)Chg.LatestPreviousWeek Ago
Henry Hub, US (futures)0.839.118.287.84
NBP, UK (futures)+4.9446.9241.9946.45
European Spot Pricing
Chg.LatestPreviousWeek Ago
Dutch TTF3.9560.8256.8760.90
Zeebrugge (Belgium)3.6151.6248.0226.36
German NCG2.4860.6558.1763.83
NBP (UK)-2.8741.9644.8327.59
US Markets
US Spot Prices
Sabine Pass, Louisiana0.278.658.388.12
Corpus Christi, Texas0.398.267.877.70
Cove Point, Maryland----7.747.48
Elba Island, Georgia0.868.657.79--
Nymex Henry Hub Futures
Near Month0.839.118.287.84
Second Mth0.839.178.337.90
Third Mth0.839.318.488.04
Created with Highcharts 9.0.0($/MMBtu)GLOBAL GAS PRICINGUS NymexDutch TTFNE AsiaOct '21Nov '21Dec '21Jan '22Feb '22Mar '22Apr '22May '22Jun '22Jul '22Aug '22Sep '220255075100125Energy Intelligence