- Total SA’s Mozambique liquefied natural gas project has completed as much as $16 billion in funding involving a score of banks, despite a slowdown in energy investment caused by the pandemic.
- It is said to be the biggest foreign direct investment in Africa yet, according to law firm White & Case LLP
- Mozambique LNG will generate about $50 billion in revenue for Mozambique’s government over 25 years
The African Development Bank will provide $400 million in senior loans and the Japan Bank for International Cooperation signed a loan agreement for as much as $3 billion for the scheme in northern Mozambique, they said Thursday in separate announcements.
The amount raised, which includes a loan from the Export-Import Bank of the U.S, matches the African nation’s gross domestic product.
The financing achievement underscores the faith being shown in the $23 billion project known as Mozambique LNG.
While crude oil has staged a partial comeback from the worst effects of the pandemic, the gas market continues to face a massive oversupply. Despite this, lenders are betting on the country’s location in southern Africa for ease of export, and the sheer size of gas deposits linked to the project.
The project, which could be transformational for the country’s economy, still faces significant challenges including its location in an area where an Islamist insurgency began in 2017.
