The South African oil company Sasol has reached a final investment decision (FID) on the production sharing agreement for the Temane natural gas project in Mozambique. The project, which is expected to cost US$760m, includes a 450 MW gas-fired power plant and a liquefied petroleum gas (LPG) facility. Construction should start in 2021 and commissioning is scheduled in 2024.
The facilities are developed by a consortium between the Mozambican state-owned power utility Electricidade de Moçambique (EDM), Globeleq, which is an Africa-focused independent power producer owned by CDC (70%) and Nordfund (30%), the UK-based infrastructure developer eleQtra and the South African energy and chemical group Sasol. Gas will be supplied by Sasol and the Mozambican national oil and gas company Empresa Nacional de Hidrocarbonetos (ENH) from the PSA gas field and electricity will be sold to EDM under a 25-year power purchase agreement (PPA).
In September 2020, the US International Development Finance Corporation (DFC) approved a U$200m loan to the project. The project also received a US$300m grant and a US$120m guarantee from the World Bank in June 2019. In addition, the plant was awarded a US$24m grant from the Norwegian Trust Fund, a US$33m grant provided by the African Development Bank, a US$100m lease and loan through the Islamic Development Bank, and a contribution from the OPEC Fund for International Development of US$36m.
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