AIM – Mozambique’s National Petroleum Institute (INP), the regulatory body for oil and gas operations, is confident that the construction and installation of the Coral South floating liquefied natural gas (FLNG) unit is going ahead in accordance with the agreed calendar, with no significant delays.

Speaking at a Maputo press conference on Wednesday, INP chairperson Carlos Zacarias, said that the construction of the FLNG unit in South Korean shipyards is already 73 per cent complete.

Last month, the power generation unit was lifted on board the hull of the FLNG unit. This marked the start of the integration between the hull, launched in January, and the massive topside (12 process modules of around 70,000 tons), both currently under construction in Korea.

The work in South Korea, and in other parts of the supply chain scattered across the globe, will be completed in2021, said Zacarias, and once all the modules have been fixed to the hull, the entire unit can be towed across the Indian Ocean to Mozambique.

“The Coral South platform should be transported to Mozambican waters so that, in 2022, the production of natural gas and its liquefaction may begin”, he added. In principle, there will be no delay in supplying LNG to the importing markets.

The Coral FLNG consortium is led by the Italian energy company ENI, which is the operator of Rovuma Basin Area Four, with a participation of 25 per cent. ENI’s partners in Area Four are ExxonMobil of the United States (25 per cent), the China National Petroleum Corporation (20 per cent), Kogas of South Korea (10 per cent), Galp of Portugal (10 per cent), and Mozambique’s own National Hydrocarbon Company, ENH (10 per cent).

But a much larger LNG project, also based on gas fields in Area Four, really has been delayed. Zacarias confirmed that the Final Investment Decision (FID) for the project, led by ExxonMobil, and envisaging onshore LNG plants, has been postponed from this year into 2021.

“Due to a combination of factors, including the fall in the world market price of oil, and the effects of the Covid-19 pandemic, the Final Investment Decision has been delayed”, he said, although he had no doubt that the decision will eventually be taken.

The third Rovuma Basin LNG project is based on gas finds in Area One, nearer to the coast, and the operator is the French oil and gas company Total.

This project ran into problems because the Total work camp, on the Afungi Peninsula, in the Cabo Delgado district of Palma, was the scene of a major Covid-19 outbreak. The largest single cluster of Covid-19 cases in Mozambique yet diagnosed was at Afungi.

“We believe the situation is under control”, said Zacarias, “and so we have redesigned the start of some activities. The camp has been decontaminated, and the infected people have complied with all the guidelines for necessary isolation that they had to follow”.

He believed that some activities in the camp will shortly be relaunched: although the companies providing services to the camp, as well as everybody working there must observe the necessary health, safety and environment procedures.