ADNOC has bought Galp’s 10% interest in the Area 4 concession of the Rovuma basin in Mozambique, marking ‘a major milestone’ in the company’s international growth strategy and first investment in the African country.
The acquisition will entitle ADNOC to a share of the liquefied natural gas (LNG) production from the concession, which has a combined production capacity exceeding 25 million tonnes per annum (mtpa).
The Area 4 concession includes the operational Coral South Floating LNG (FLNG) facility, the planned Coral North FLNG development and the planned Rovuma LNG onshore facilities.
The investment complements ADNOC’s efforts to expand its lower-carbon LNG portfolio to meet growing gas demand and support a just, orderly and equitable energy transition.
Musabbeh Al Kaabi, ADNOC Executive Director for Low Carbon Solutions and International Growth, said it is building on its 50-year experience in LNG with this investment in the Rovuma supergiant gas basin in Mozambique.
He said, “Natural gas plays an important role to meet growing global demand with lower emissions compared to other fossil fuels and this acquisition supports our efforts to build an integrated global gas business to ensure we continue providing a secure, reliable and responsible supply.”
The Coral South development, currently in operation, is capable of producing up to 3.5 mtpa of LNG, and represents the first facility of its kind in Africa.
The proposed Coral North development is expected to produce a further 3.5 mtpa of LNG through a FLNG facility to process and liquefy natural gas for export.
The 18 mtpa Rovuma Onshore LNG development is a modular, electric-drive design that will significantly reduce the carbon intensity of the LNG it produces, when compared to industry benchmarks.
The facility’s design philosophy and its emphasis on limiting carbon dioxide (CO2) emissions aligns with ADNOC’s ambition to achieve Net Zero by 2045.
Mozambique’s Rovuma supergiant gas basin represents one of the world’s largest gas discoveries in the past 15 years and holds proven reserves to provide a stable supply of natural gas to the FLNG and Onshore facilities.
LNG offtake agreement with NextDecade
This week ADNOC has also announced the acquisition of a 11.7% stake in Phase 1 (Trains 1-3) of NextDecade Corporation’s Rio Grande LNG, a leading export project located in Texas, which is expected to produce a less carbon-intensive LNG (click here).
ADNOC and NextDecade have also entered into a 20-year LNG offtake agreement from RGLNG Train 4, involving 1.9 mtpa, on a free on board (FOB) basis at a price indexed to Henry Hub, subject to Final Investment Decision (FID).
NextDecade is currently targeting FID on Train 4 in the second half of 2024.
The Phase 1 RGLNG equity stake has been acquired through an investment vehicle of Global Infrastructure Partners (GIP). ADNOC acquired a portion of GIP’s existing equity interest in Phase 1 while NextDecade retains its previously announced expected economic interest in Phase 1 as well as its interests in the Train 4 and Train 5 expansion capacity.
Rio Grande LNG, situated on a 984-acre site near Brownsville, Texas, is the first US LNG project offering expected emissions reduction of more than 90% through carbon capture and storage (CCS).
Last week ADNOC delivered the world’s first certified bulk commercial shipment of low-carbon ammonia enabled by carbon capture and storage (CCS) to Mitsui & Co. for use in clean-power generation in Japan. The low-carbon certification process, from production to delivery, was conducted by TÜV SÜD.
