Mozambique courts South African investment for new gas project

CAPE TOWN, Oct 19 (Reuters) - Mozambique's state-owned oil company ENH is in talks with potential investors, including South Africa's Sasol SOLJ.J and pipeline company ROMPCO, for a new natural gas project as the country aims to become a regional "power hub", the chief executive of ENH said.

Mozambique, the primary supplier of gas to South Africa from Sasol’s onshore Pande and Temane fields that are expected to be depleted within a few years, has massive resources in its offshore Rovuma Basin and could help meet South Africa’s future gas demands.

The new project, centred on the coastal towns of Beira and Inhassoro, is expected to cost about $250 million and would involve the development of floating storage and regasification units (FSRU) at Inhassoro and the Port of Beira.

A new 140 kilometre pipeline would connect the facilities to the larger ROMPCO pipeline, the main gas artery running from Mozambique to South Africa's Secunda industrial complex.

ENH is part of a group of state-owned companies handed an exclusive 30-year concession last year to build and operate natural gas facilities in the Southern African country where oil companies TotalEnergies TTEF.PA, ExxonMobil XOM.N and Eni ENI.MI are developing large LNG plants.

"We want our infrastructure by 2030 or 2031, in step with Mozambique LNG, Rovuma LNG and Coral North," Rudencio Morais, the CEO and chairman of ENH, told Reuters in an interview.

Gas from these developments is mostly destined for international markets, although new petroleum laws in place since June require at least 25% of gas and oil production, now explicitly including LNG, to be allocated to the domestic market.

"Mozambique is going to become what we call the power hub," Morais said as the country looked to export gas into a region plagued by power shortages.

Sasol said it would be premature to speculate on the nature or scale of any potential investments as it sought alternative gas supplies, while ROMPCO did not immediately respond to a request for comment.