Mozambique Signs $400m Agreement with Great Lakes Africa Energy for Domestic Use of Rovuma Basin Natural Gas Reserves

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The Republic of Mozambique has signed a Memorandum of Understanding (MoU) with UK-based Great Lakes Africa Energy (GLAE) to generate electric power using natural gas for domestic use at an estimated value of $400 million.

The agreement, which was signed this May in Maputo, Mozambique, will involve the construction of a 250 megawatt (MW) gas-fired electricity generating power plant.

GLAE, a UK registered Pan African energy solutions provider, will develop, finance, build, own and operate the power plant to be fed with natural gas supplies from Mozambique’s Rovuma Basin.

The MoU was signed by Mozambique’s Minister for Mineral Resources and Energy, Dr. Max Elias Tonela, and GLAE Director, Mr. Michael Kearns.

The agreement follows the result of Mozambique’s Rovuma Basin domestic gas tender, the results of which were announced in January 2017.

“As part of the Mozambique Government’s intended use of natural gas for the development of domestic power projects, GLAE will develop, finance, build, own and operate a 250 megawatt gas-fired electric generating power plant, planned in Northern Mozambique,” said Michael Kearns of GLAE.

The power plant will be one of the largest conventional sources of electricity in the country.

Mozambique, which has vast offshore gas resources, has decided to use some portion of the extracted gas for domestic power projects, with an aim of achieving a sustainable economic growth, including domestic energy production.

Speaking on behalf of the Government of Mozambique, Bruno Senguaio, Assistant to the Minister, said that Mozambique has considerable renewable and conventional energy resources and is fast becoming a significant energy producer.

“Our Government’s chief priority is to ensure a secure and reliable energy supply for the people of Mozambique. This is why the project is so important. In GLAE we have found a reliable partner which will help us deliver this power plant,” he added.

The power plant in Northern Mozambique is a key regional infrastructure project. It will accelerate the development and industrialization of several other industrial projects, which have been shelved due to the lack of a steady power supply.

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