BUSINESS
Although coal mining is under pressure, the
big coal mines in Mozambique, together
with gas projects in the Ravuma basin will
drive the economy in the medium term.
LNG OFFERS
MANY OPPORTUNITIES
The Liquefied natural gas (LNG) sector in Mozambique opens up a myriad of opportunities
for South African suppliers, writes Duncan Bonnett, director at Africa House.
M
ine closures, retrenchments,
declining industrial output, a
construction sector in torpor
and no apparent short-term
solutions for these ills paints a grim picture
for suppliers of goods and services into
South Africa’s extractives, construction and
civils sectors. Our neighbour may just have
answered our prayers.
According to estimates USD64-billion is
only half of what is expected to be spent on
developing the Afungi Peninsula, about the
size of Umhlanga in a South African context,
and linked areas over the next decade as
Cabo Delgado Province in Mozambique’s
remote far north is transformed into the
world’s next major LNG supplier.
18
MARCH 2020
The roughly USD130-billion that is expected
to be spent on delivering eight LNG trains
and the floating LNG project by 2029 also
represents only half of the proposed 16-train
project envisaged over the longer term.
So what? I’ve heard many companies
asking this, with the common rejoinder
that South Africa is not an oil and gas
specialist market, so we’re not natural
suppliers – or that the projects have been
kicking around for years and won’t go
ahead. The reality is completely different:
the FLNG project (limited opportunity)
is well underway, which will bring major
revenues into government coffers in the
next couple of years, whilst the Area 1
project, led by Total, is now gathering pace.
A few basic facts about the project:
•
Within three years there will be up to
50 000 workers on site, all needing
to be fed, secured, entertained
and kept healthy. South African
companies are involved in the initial
camp sites that are being built to
house the workers that will build the
main camp sites. Workers on site will
also require protective clothing and
the like over the build, operation and
maintain period;
•
LPG supplies are needed for at
least five years for these sites; An
estimated 2 million eggs a month
will be required – from over 50 000
laying hens!
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