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BMI Research: “Mozambique’s Gas Production to Rise by Just 1% in 2024 After 47% Growth This Year”

BMI Research: “Mozambique’s Gas Production to Rise by Just 1% in 2024 After 47% Growth This Year”

BMI Research estimates that natural gas production in Mozambique will increase by just 1 per cent next year, a significant slowdown compared to the 47 per cent growth expected this year.

In a note analysing natural gas production, the consultancy predicts that growth in gas production in Mozambique will undergo a sudden slowdown, following the start of CoralFLNG’s activity this year. “And we anticipate a minimum growth of 1% in 2024, a substantial drop compared to the 47% recorded this year, totalling 9.2 billion cubic metres,” says the report, sent to clients, to which Lusa had access this Friday, December 1.

The analysts also predict that in the coming years there will be “a vacuum of new projects”, so that by 2027 natural gas production should be at the same level as this year, with only small projects being able to come on stream and perhaps being cancelled out by natural decline rates.

In September, TotalEnergies confirmed that it expected to begin commercial operations in 2028, after having previously indicated a date of 2027, which started out as 2024, until the armed conflict in the north of the country forced the suspension of the French company’s operations in Cabo Delgado.

Among the main strengths of the gas projects in the country, BMI Research points to the strong potential of the Mozambican coast, the geographical position in relation to the Asian market and the fact that the new projects will place the country among the world’s main exporters.

On the other hand, the main weaknesses are the underdeveloped infrastructure and domestic demand, as well as the delay in implementing the regulatory framework for gas exploration on the mainland.

Mozambique has three development projects approved to exploit the natural gas reserves in the Rovuma basin, which are classified among the largest in the world and are located off the coast of Cabo Delgado province.

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Two of these projects are larger and involve channelling the gas from the seabed to land, cooling it in a plant and then exporting it by sea in a liquid state.

One is led by TotalEnergies (Area 1 consortium) and work progressed until it was suspended indefinitely after the armed attack on Palma in March 2021, when the French energy company declared that it would only resume work when the area was safe. The other is the still unannounced investment led by ExxonMobil and Eni (Area 4 consortium).

A third completed, smaller project also belongs to the Area 4 consortium and consists of a floating platform for capturing and processing gas for export, directly at sea, which started up in November 2022.

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