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Pouyanne discussed the Mozambique LNG project during TotalEnergies’ strategy and outlook presentation in New York on Wednesday.
According to the company, the giant project is expected to launch operations in 2029.
“So, the 2029 target, which is on the slide, is linked to restarting the project by the end of 2024. This is where we are today on this project,” Pouyanne said.
However, the restart of the project remains subject to security and financing commitments.
TotalEnergies declared force majeure on the Mozambique LNG project in April 2021 and withdrew all personnel from the site due to new attacks.
Mozambique LNG includes the development of offshore gas fields in Mozambique’s Area 1 and a liquefaction plant at the Afungi complex.
Besides TotalEnergies, other partners in the project include Japan’s Mitsui, Mozambique’s ENH, Thailand’s PTT, and Indian firms ONGC, Bharat Petroleum, and Oil India.
Mozambique visit
Mozambique LNG’s EPC contractor is CCS JV, a venture between Saipem, McDermott, and Chiyoda.
Last year, Pouyanne said the company was “not in a hurry” to resume the project, pointing out that security, human rights, and maintaining costs are the main three elements to make the decision to return to the Afungi site in the province of Cabo Delgado.
Asked about potential cost escalations at Mozambique LNG during the company’s second-quarter results call on July 25, Pouyanne said that “everything has been settled with the contractors.”
“On the contractor side, everything has been said, including the costs of the frozen period and the impact on the costs of the project. I think one of our partners mentioned $3.5-$4 billion,” the CEO said on Wednesday.
“But this project remains profitable.. We are committed to the project,” he said.
“On the security side, there is some progress on the ground,” Pouyanne said.
He noted that Mozambique has an alliance with Ruanda on the matter.
Moreover, “there is an election in Mozambique, and the new president will come,” Pouyanne said.
“I intend to visit Mozambique by the end of the month to meet him to discuss (the project),” he said.
Financing
“And then we are working on the last piece in order to be able to restart the full project,” he said.
This is the financing of the project.
“When we inherited the project from Anadarko, it was quite a big financing package. It was almost $14 billion,” he said.
“I would say 70 or 80 percent of (financiers) are confirmed. We are waiting for three of them to confirm as well the commitment. Because it is important,” he said.
“Some of them are in Western countries where… I would say the stance towards financing of LNG projects and oil and gas projects has moved,” Pouyanne said.
“But all of them are telling us that they are committed to the contracts they signed,” he said.
“So we are waiting for the green light on this financing from these three credit agencies. I hope we will get them soon,” Pouyanne said.
“As soon as all that is in place we intend to restart the project,” he said.