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Africa takes the lead in record-year for LNG

10th July 2019

Africa is taking the lead in the next phase of global LNG mega-projects. 2019 will shatter previous records for the industry.

Africa takes the lead in record-year for LNG
Africa takes the lead in record-year for LNG

Rystad Energy forecasts that LNG greenfield investment in 2019 will reach nearly $103 billion, the biggest investment year for the burgeoning industry to date.

Mozambique’s Area 1 and Area 4 projects, the latter of which is expected to secure a final investment decision (FID) from operator ExxonMobil by the end of the year, are making Africa the dominant LNG investment destination this year, with nearly one-third of total greenfield investment.

“Last week’s final investment decision by Anadarko for its Area 1 LNG project marks the beginning of a new phase for not only Mozambique and the African continent, but for the industry as a whole,” says Pranav Joshi, analyst on Rystad Energy’s Upstream team.

The greenfield capex for the Area 1 project is estimated at $15.6 billion, putting the project in the same league as the major LNG developments in the US, Russia and Australia. If ExxonMobil’s Area 4 does indeed reach FID this year, that will represent another $14.7 billion in greenfield expenditure in Africa, bringing the yearly total to 28% of the global tally for approved investments in newly sanctioned LNG projects.  

“Area 1 is the largest LNG project that has been sanctioned in Africa to date and will also kick start the wave of sanctioning activity of other bigger LNG projects this year,” Joshi added.