Eni Approves $7.2 Billion Coral Norte LNG Project, Doubling Mozambique's Production

What's Happening?

Eni SpA has given financial approval for the construction of a $7.2 billion floating liquefied natural gas (LNG) project off the northern coast of Mozambique. The Coral Norte project is set to double the country's LNG production capacity, producing 3.6 million tons annually. This project follows the design of Coral Sul, which began exporting LNG in 2022. Eni's CEO, Claudio Descalzi, announced that this development will position Mozambique as Africa's third-largest LNG producer, following Nigeria and Angola. The project is expected to commence production in 2028, marking a significant advancement in Mozambique's LNG sector, which has faced delays due to regional militancy.

Why It's Important?

The approval of the Coral Norte project is a pivotal moment for Mozambique's economy, potentially transforming it by capitalizing on its vast natural gas reserves. As global demand for LNG continues to rise, Mozambique's increased production capacity could enhance its economic standing and provide a substantial boost to its GDP. This development also signifies a resurgence in Mozambique's energy sector, which had been hindered by security challenges. For the global LNG market, the project contributes to diversifying supply sources, which is crucial for energy security and price stability. The involvement of major energy companies like Eni and TotalEnergies underscores the strategic importance of Mozambique's gas reserves.

What's Next?

With production slated to begin in 2028, the next steps involve finalizing contracts and commencing construction. The project is expected to attract significant foreign investment and create job opportunities, contributing to local economic development. Stakeholders, including the Mozambican government and international energy firms, will likely focus on ensuring security and stability in the region to protect their investments. Additionally, the project may prompt further exploration and development of Mozambique's untapped gas fields, potentially leading to more projects in the future.