African Liquefied Natural Gas (LNG) To Attract $103 Billion In 2019

Must Read

List of Guaranty Trust Bank Sort Codes & Branches (with addresses) in Nigeria

The sort code is a number which usually identifies both the bank and the branch where an account is...

Top 10 Most Expensive Universities In Nigeria

For many Nigerians, high-quality higher education is a luxury. There are many private universities who are known not only...

Novel Coronavirus: Lagos alerts public, lists precautionary measures

…Says No Case Of Virus Reported In Nigeria The Lagos State Government has alerted the public to a new virus,...
- Advertisement -
- Advertisement -

Africa is an exciting frontier in the global natural gas sector. The continent holds 7.1 per cent of proven global gas reserves and is expected to contribute nearly 10 per cent of global production growth through to 2024.

On the demand side, Africa’s large, urbanized and industrialized societies of the future will require reliable and sustainable power generation. With greenfield investments in Nigeria, Egypt, Mozambique and elsewhere reaching nearly $103 billion this year, it is clear that liquefaction is viewed as the most profitable strategy for realizing Africa’s gas potential.

Record investments on the supply side

Nigeria accounts for over 50 per cent of current LNG production capacity on the continent. With October 2019 seeing a final investment decision on the $12 billion expansion of the country’s liquefaction plant at Bonny Island in Rivers State.

The Train 7 expansion project would increase Nigerian LNG production capacity by 35 per cent, from 22 million tons per annum to 30 million. Current indications point to a positive verdict. The twenty-year-old facility is owned and operated by a consortium which includes NNPC, Shell, Total and Eni.

In North Africa, Egypt has successfully re-established itself as an important investment destination following the downturn in the gas sector in 2014. In the first half of 2019, the behemoth Zohr offshore gas field produced 11.3 billion cubic meters – 3.6 times more than it did in 1H2018. The success is set to continue with reports earlier this year of a new Eni discovery in the Nour North Sinai Concession. Evaluation is ongoing but there are hopes that the new field could rival the Zohr, which would open significant opportunities for investment in new liquefaction plants. In February, the Egyptian Natural Gas Holding Corporation awarded five new gas exploration concessions to Shell, ExxonMobil, Petronas, DEA and Eni in which it expects to see 20 wells drilled.

Read:  Total Nigeria Plc 9M- 2019: Weaker revenue and high costs pull earnings
Read:  G5 Sahel Summit: African Development Bank, Partners, Commit To Light Up And Power The Sahel With the Desert To Power Initiative

In June, Anadarko gave its final approval for a $20 billion gas liquefaction and export terminal in Mozambique. The Area 1 project is the single largest LNG project ever approved in Africa. And, it could be closely followed by Exxon’s $14.7 billion Area 4 development – FID is expected before the end of the year. Political stability and access to East Asian markets could see Mozambique become a major global gas market over the next decade.

Investors are also paying attention to smaller projects in countries like Mauritania, Senegal and Cameroon. Operators have been successfully able to deploy floating liquefied natural gas (FLNG) technology to realise the value of smaller assets in these markets and this could be a continuing trend in 2020 and beyond. Eni and partners are considering a $7 billion FLNG for the Coral South field in Mozambique.

Read:  Seventh Tokyo International Conference On African Development

South Africa’s LNG diversification play

In terms of African demand for LNG, South Africa – the most industrialized economy on the continent – could be an influential market.

Heavy coal consumption and unreliable power generation make natural gas an attractive solution to diversify its power generation base. In 2020, Transnet – a state-owned freight logistics firm – will launch a tender for the development of an LNG import terminal at Richards Bay Port. The World Bank’s International Finance Corporation has committed $2 million to fund the project planning.

These and other recent developments reflect a growing and diverse African LNG sector. From top-tier greenfield developments to faster-to-market, agile FLNG operations; massive new discoveries to expanding existing liquefication infrastructure. It is an exciting time to be involved, as demonstrated by the high-profile speakers taking part in this year’s Gas Exporting Countries’ Forum, be hosted by Equatorial Guinea in Malabo.

- Advertisement -

Subscribe to BrandSpur Ng

Subscribe for latest updates. Signup to best of brands and business news, informed analysis and opinions among others that can propel you, your business or brand to greater heights.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Latest News

CBN MPC Retains MPR and Liquidity Ratio; Raises CRR to 27.5% In First Meeting of 2020

The Monetary Policy Committee (MPC) concluded its two-day policy meeting today. The committee agreed to raise the cash reserve...

Airtel Gets New Number Range, 0904

Leading telecommunications services provider, Airtel Nigeria, has announced that it has added 0904 number series to its numbering range, following the approval of the...

EUR114 million in fines have been imposed by European authorities under GDPR

Breach notifications exceed 160,000 in Europe since the introduction of GDPR according to a survey by DLA Piper European data protection regulators have imposed EUR114...

Fashion Fix 3 (Ep 6)- Your Transitional TGIF Wardrobe

Award-winning fashion stylist Rhonke Fella joins Mercy on this week’s episode of Fashion Fix to discuss getting your Friday office workwear sorted. The pair dish...

More Articles Like This