ExxonMobil awards McDermott letter of intent for Rovuma LNG Phase 1 engineering and procurement work in Mozambique

ExxonMobil Moçambique Limitada, acting on behalf of the Area 4 partners, has awarded McDermott Energy Solutions (UK) Ltd. a letter of intent for limited engineering and procurement services on the Rovuma LNG Phase 1 midstream development in Mozambique. It’s a concrete step forward for one of ExxonMobil’s biggest global bets.

ExxonMobil issues LOI to McDermott for Rovuma LNG Phase 1

McDermott Energy Solutions (UK) Ltd. holds a majority stake in the SMDC joint venture. Its partners in that consortium are Saipem S.p.A., Daewoo Engineering & Construction Co. Ltd., and China Petroleum Engineering & Construction Corp. (CPECC). Together, they’re now formally on the hook to deliver limited engineering and procurement services for the continuation of Rovuma LNG Phase 1.

The scope covers midstream development work, building directly on FEED services McDermott already completed for the same project. That prior engagement gave the company deep familiarity with the work—and it looks like familiarity was the decisive factor here.

Financing challenges, security concerns in the Cabo Delgado province, and broader energy market volatility have all slowed progress at various points.

Award driven by project definition work ahead of final investment decision

The LOI isn’t a full EPC contract. It’s a more targeted instrument, designed to keep project definition and planning moving while the Area 4 partners work toward a final investment decision—currently expected in 2026.

Rob Shaul, McDermott’s senior vice president of low carbon solutions, was straightforward about what got them here. “Having successfully executed FEED for Rovuma LNG, we are well positioned to advance the project into its next phase,” he said. The FEED work gave McDermott institutional knowledge that a new contractor simply couldn’t replicate on a short timeline. The partners are balancing momentum against the risk of committing too much capital before FID is locked in—and this LOI threads that needle.

Project scale: 18.6 million capacity and 2031 start-up target

The numbers are hard to ignore. The Rovuma LNG onshore development is expected to include 12 modular liquefaction modules producing 18.6 million metric tons per year of LNG—placing it among the largest such developments in planning anywhere in the world right now.

Start-up is targeted for 2031, roughly five years from the expected FID date. Tight, but not unusual for a project this complex. ExxonMobil has called Rovuma LNG its largest single investment, and that label alone signals how much weight the company places on getting execution right from the earliest engineering phases.

Engineering work to be split across London, Gurgaon, and Milan offices

McDermott has laid out a clear geographic split for the work. Engineering of the inside battery limits—including the liquefaction modules—will run out of its London and Gurgaon offices, while project management will be seconded to the JV team based in Milan.

That structure reflects the multinational makeup of the SMDC consortium. London and Gurgaon bring established LNG engineering capacity; Milan serves as the coordination hub for the broader joint venture. CEO Michael McKelvy pointed to the company’s in-country track record as the foundation for what comes next. “Our experience on Mozambique LNG, combined with our long-term commitment to the country, positions us to deliver critical infrastructure that supports Mozambique’s emergence as a major global LNG supplier,” he said. Shaul echoed that framing: “This award reflects the strength of our long-standing relationship with ExxonMobil and our ability to deliver complex LNG developments.”

Mozambique’s role as an emerging LNG supplier underpins project rationale

Mozambique holds some of Africa’s largest proven natural gas reserves, concentrated mainly in the Rovuma Basin in the country’s north. The Area 4 block, operated by ExxonMobil, is estimated to hold around 85 trillion cubic feet of recoverable gas resources—a figure that makes the commercial case for a development at this scale fairly self-evident.

Rovuma LNG is positioned to turn Mozambique into a significant global LNG exporter, though that ambition has been years in the making. Financing challenges, security concerns in the Cabo Delgado province, and broader energy market volatility have all slowed progress at various points.

McDermott brings more than engineering credentials to this engagement. The company previously executed work on the separate Mozambique LNG project, giving it direct in-country operational experience—familiarity with local logistics, conditions, and stakeholder dynamics that doesn’t show up neatly on a résumé but matters considerably in practice.

Targeting 18.6 million metric tons per year

Here’s where things stand: ExxonMobil Moçambique Limitada has awarded McDermott Energy Solutions (UK) Ltd. a letter of intent covering limited engineering and procurement services for Rovuma LNG Phase 1. McDermott holds a majority stake in the SMDC JV alongside Saipem, Daewoo E&C, and CPECC.

The work supports project definition ahead of a final investment decision expected in 2026. Targeting 18.6 million metric tons per year of LNG production from 12 modular liquefaction modules, the project anticipates start-up in 2031.

Engineering will be split between McDermott’s London and Gurgaon offices, with project management seconded to the JV team in Milan. ExxonMobil considers Rovuma LNG its largest single investment—and this LOI keeps that investment on track.

Kelly Lippke

Kelly is an experienced writer with 15 years of experience exploring the big stories that shape our world, from tech breakthroughs and space exploration to climate, energy, and the fascinating quirks of science. She has a talent for turning complex ideas into sharp, memorable insights that stay with readers long after they’ve finished reading.