Large Oil & Gas Companies Submitted Proposals for Hydrocarbon Prospection in Mozambique
By Kester Kenn Klomegah
The Mozambican Ministry of Mineral Resources and Energy has said that, at least, 13 oil and gas companies have delivered bids for the prospection and exploration of hydrocarbons, in response to the sixth licensing round for exploration and production concessions.
According to Radio Mozambique (RM) news report, the giant companies such as Exxon Mobil, and Total Energies have delivered bids, as have the two Russian companies Rosneft and Novatec. But the Russian bids are unlikely to be considered as serious contenders following the strict sanctions imposed by the United States and European countries in response to the Russian invasion of Ukraine.
Other oil giants that have put in bids include the Italian ENI; Sinopec, CNOOC, CNPC and Petro China International all from China, Qatar Petroleum; the South African Petrochemical company Sasol; ONGC Videsh from India; the Irish Discovery Exploration and Aiteo from Nigeria.
The sixth tender for the concession of offshore blocks for oil and gas exploration was launched in November 2021 and urged companies interested in participating to spend the time available to draw up cohesive and feasible plans for their bids.
The bids, after approval, allow the companies up to eight years to prospect for oil and gas, and will have the exclusive right to undertake operations in the areas where any discoveries are made, the exclusive right to build and operate infrastructures, and the right – though not exclusive – to build and operate oil and gas pipelines.
In the event of making any discovery, the company will have production rights for a maximum of 30 years. The 16 offshore blocks offered are all in deep water. Five of them are in the Rovuma Basin, in the far north, off the coast of Cabo Delgado province, seven are in the Angoche area, off the coast of Nampula, two are in the Zambezi Delta, and two are near the mouth of the Save river in the south of Mozambique.
Carlos Zacarias, Chairman of Mozambique’s National Oil Institute (INP), said that evaluating proposals for the concession of hydrocarbon exploration blocks were done strictly to the rules. Mozambique already has the presence of several multinational oil sector companies, mainly in the Rovuma basin, an area rich in natural gas. Despite growing international pressure to abandon the use of fossil fuels, the Mozambican government argues that natural gas will be a crucial source for the energy transition as it is the least polluting of the fossil fuels.
Mozambican President Filipe Nyusi and French TotalEnergies CEO Patrick Pouyanné witnessed, late January 2022, the signing and exchange of fresh additional agreements that permit prompt resumption of natural gas project in Cabo Delgado, northern Mozambique.
The construction of the gas liquefaction plant, extracted from the seabed (about 40 kilometers offshore) is the largest currently financed private investment in Africa. The natural gas project was suspended in March 2021 after an armed attack that left the province devastated, about 3,100 deaths and more than 817,000 residents displaced.
The agreement reflects the willingness to pursue its investments in Mozambique’s energy sector in order to deploy our multi-energy strategy in the country through retailing of petroleum products for mobility, the major Mozambique LNG project and accompanying supply of domestic gas, and opportunities under review in the area of renewable energies. It aims at contributing to the country’s sustainable development and give access to energy to as many people as possible.
The signed agreement with the Mozambican authorities will allow training for a group of 2,500 young people from Cabo Delgado, with a view to creating job opportunities arising from the ongoing investments.
According to a statement from TotalEnergies, this training is within the scope of the memorandum of understanding signed between the Secretariat of State for Youth and Employment, through IFPELAC, and TotalEnergies EP Mozambique Area 1 Limitada, operator of the Mozambique Liquid Natural Gas (LNG) project.
TotalEnergies is a global multi-energy company that produces and markets energies: oil and biofuels, natural gas and green gases, renewables and electricity. It has approximately 105,000 employees and are committed to make energy affordable, cleaner, more reliable and accessible to as many people as possible.
Mozambique has grappled with an insurgency in its northernmost province of Cabo Delgado since 2017, but currently fast improving after the deployment of joint military force with the primary responsibility of ensuring peace and stability, and for restoring normalcy in the country.
With an approximate population of 30 million, Mozambique is endowed with rich and extensive natural resources but remains one of the poorest and most underdeveloped countries in the world. It is a member of the Southern Africa Development Community (SADC). Mozambique is located in Southeast Africa bordered by the Indian Ocean to the east, Tanzania to the north, Malawi and Zambia to the northwest, Zimbabwe to the west, and Eswatini (previously called Swaziland) and South Africa to the southwest.