Africa is set to become a major player in the energy sector as Eni, one of Italy’s largest energy companies, has announced that it has reached an FID, or Final Investment Decision, for its second floating LNG facility off the coast of the African nation of Mozambique. Africa has become a go-to destination for a litany of energy companies aiming to pioneer a future without the need to rely on certain Eastern European countries. Eni has vast experience in the energy sector and has been operating in Mozambique for many years already.
More and more energy companies are turning to the African continent
Eni is just the latest international energy company to develop pioneering projects in Africa, with Chevron and others also making the trip to Africa to contemplate an entry into the market. The planned project is a mirror of another offshore LNG facility in Mozambique, which was so successful that Eni now has plans to build a second facility.
Once the Coral North LNG project comes online, Mozambique will become Africa’s top LNG producer, which is saying something as a vast number of African nations have finally begun to explore the potential for LNG production off their shores. The stakeholders came together at a recent ceremony at an upmarket hotel in Maputo, with Mozambique’s President Daniel Chapo and Eni Chief Executive Claudio Descalzi in attendance.
The new Coral North facility will be a split image of another project in Mozambique
Eni has noted that the new Coral North facility will be a mirror image of the already in production project called Coral South, which began exporting LNG to Europe in 2022. Once both projects are online, their combined output will double Mozambique’s annual output of LNG to more than 7 million tonnes. The project has the added benefit of generating $23 billion in tax revenue for the African nation.
The Coral North project is an exemplar of the cooperative nature of the energy sector
For many nations and companies, ensuring energy projects are built on time and face no major interruptions is key; however, many lack the infrastructure or necessary funding to be a success. That’s where the Coral North project is different. Eni has noted that while it will hold a majority share in the project, it also has several partners that will be essential to the project’s success.
Some of the other companies and organizations involved are:
- China National Petroleum Company
- Korea Gas Corporation
- Mozambican national oil company ENH
- ADNOC subsidiary XRG
With the East African Crude Oil pipeline nearing completion following years of development, along with the second floating LNG project in Mozambique, the African continent is set to see its role in the international energy sector reach new levels in the near future.
“With Coral North we will contribute to supply the worldwide growing demand for LNG, doubling both Mozambique’s contribution to global energy security, and the benefits for the country and its citizens in terms of economic and industrial growth.” – Eni CEO Claudio Descalzi
Africa’s gas production is key as the world enters a new future without Russian energy
Due to the ongoing war in Ukraine, the West has imposed a new wave of sanctions on Russian energy resources, with the EU developing a joint purchasing platform to boost non-Russian supply into Europe. That has led the world to contemplate how to efficiently transition away from Russian energy towards other nations capable of producing energy resources, such as Mozambique. The new Coral North project will become an exemplar of the new cooperative nature of the international energy sector. Eni has stated it expects the project to be brought online in 2028.
