Mozambique inks deals for new refinery, pipeline; advances LNG projects
The government of Mozambique has entered two strategic agreements that, if finalized, would result in construction of the country’s first crude oil refinery, as well as a grassroots pipeline for delivery of petroleum-based products from the southeast African coastal republic to neighboring Zambia.
Identified as agreements of “high-strategic importance,” the two memorandums of understanding (MOU) for development of the refinery and pipeline projects were signed in Maputo between May 7-8 during the 11th Mozambique Mining and Energy Conference (MMEC), which brought together key government representatives, energy companies, local stakeholders, development partners, service providers, and other investors to accelerate mining and energy investments in Mozambique and surrounding countries, the office of Mozambique President Daniel Chapo said in a release.
On May 7, Chapo confirmed state-owned Petróleos de Moçambique SA (Petromoc) signed an MOU with independent Aiteo Group of Nigeria subsidiary Aiteo Eastern E&P Co. Ltd. to jointly develop and build a modular-based refinery in Mozambique that would have capacity to produce 200,000 b/d combined of gasoline, diesel, naphtha, and Jet A-1 fuel for distribution to the country’s domestic and regional markets.
Slated for implementation within a maximum 24-month period, the proposed refinery project also would involve construction of new storage infrastructure capable of accommodating 160,000 tonnes/year (tpy) of liquid fuels and 24,000 tpy of LPG.
Aimed at positioning Mozambique as a relevant player in the liquid-fuels value chain, Chapo said the planned refining and storage project also would create jobs for Mozambique’s youth and help boost the country’s domestic GDP by enabling reduced finished-product imports and opportunities for exports abroad.
The parties have yet to reveal an anticipated crude-processing capacity for the refinery.
Under a second MOU signed at the event, Mozambique and Zambia agreed to cooperate on planning and development of a proposed $1.5-billion pipeline that would carry 3.5 million tpy of petroleum products about 1,400 km from Mozambique’s Port of Beira to Ndola, Zambia.
Targeted for commissioning within 4 years, the pipeline project would include construction of unidentified storage infrastructure in both Beira and Ndola, Chapo said.
Mozambican LNG projects
Alongside the grassroots refining and pipeline projects, Chapo also revealed the latest updates to Mozambique’s plans to support development of its natural gas resources.
A development plan worth more than $7 billion has been approved for the second phase of the Coral floating LNG (FLNG) project offshore Mozambique, completion of which will consolidate the country’s position as a global LNG producer and strategic supplier, Chapo said in his opening speech to MMEC attendees.
Confirmation of the project follows the Mozambique Council of Ministers’ official approval of the development plan last month.
Formally known as Coral Norte FLNG, the project aims to develop and produce 3.55 million tpy of LNG for 30 years from six production wells in the Coral Eocene 441 Deposit of ultra deepwater Coral field, Area 4, Rovuma basin, government releases from Apr. 8, 2025. said.
The government confirmed work on the Eni SPA-operated Coral Norte FLNG is scheduled to start second-quarter 2028. Coral Norte will replicate the operator’s existing Coral Sur FLNG that began producing in November 2022 (OGJ Online, Nov. 14, 2022).
Chapo also revealed to MMEC attendees that TotalEnergies SE’s 13-million tpy Mozambique LNG project on the Afungi peninsula—under force majeure since April 2021 due to security concerns and awaiting reengagement of project financers to restart—will now relaunch amid approved financing for the $20-billion development from the Export-Import Bank of the US (Ex-Im Bank). Ex-Im Bank unanimously approved the second amendment of a 2019 direct loan of up to $4.7 billion to support engineering, procurement, and construction of the project’s onshore LNG plant, related installations, and offshore infrastructure in mid-March.
Chapo additionally said efforts are under way to begin work within the next year on the ExxonMobil Corp.-led Rovuma LNG project, which is anticipated to produce, liquefy, and market 18 million tpy from reservoirs off the Afungi Peninsula in the Area 4 block of Rovuma basin that is estimated to contain more than 85 tcf of natural gas (OGJ Online, Sept. 25, 2024).
In its 2024 annual report published in February 2025, ExxonMobil said it expects to reach final investment decision on Rovuma in 2026.
Robert Brelsford | Downstream Editor
Robert Brelsford joined Oil & Gas Journal in October 2013 as downstream technology editor after 8 years as a crude oil price and news reporter on spot crude transactions at the US Gulf Coast, West Coast, Canadian, and Latin American markets. He holds a BA (2000) in English from Rice University and an MS (2003) in education and social policy from Northwestern University.