LNG projects in Africa

In 2021, total exports of LNG from Africa were reportedly about 40 million t, and analysts anticipate that Africa’s export capacity will likely continue to grow through 2022.

The potential opportunities in Africa for both operators and developers are clearly substantial.

But progress has been slow during recent years, and what follows is a snapshot of the reasons why.

In South Africa, for example, though there has been an increase in recent times of small scale LNG projects, the development of large scale import projects may continue to be dogged by difficulty. Last year there was a certain amount of criticism concerning the bidding process for the proposed development of a major LNG-to-power project across a number of sites in South Africa, including Richard’s Bay, Coega and Saldanha Bay.

In the Mozambique, TotalEnergies’ LNG project has faced drawbacks because of the activities of local insurgents, forcing the company to declare force majeure in 2021.

Nigeria, reportedly Africa’s largest producer of LNG, has had production difficulties through 2021, leading to some of Nigeria LNG’s vessels being inactive and under-utilised.

In Ghana, though the country continues for the time being to receive sufficient pipeline gas from Nigeria through the West African pipeline, it is noteworthy there has been persistent delay in recent times of the Tema LNG import terminal, albeit that the floating regas vessel, Torman, remains in position.     

There are of course various other ‘players’ of a smaller scale in Africa, for example in Algeria and Cameroon.

All this said, there is much potential in Africa for the development and operation of new and expansion LNG projects, so it continues to be a space to watch closely.

This blog is for information purposes only. It is not intended to comprise legal advice. For legal advice on African LNG, contact allbless@inarakconsultants.com

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