250MW LNG Power Plant Deal Signed in Mozambique’s Nampula Province

  • GL Energy Moçambique has finalised a concession agreement with the Government of Mozambique to finance and operate a 250MW LNG power plant in Nacala District, Nampula Province, northern Mozambique.
  • The agreement was signed in Maputo by Minster of Mineral Resources and Energy, Ernesto Max Elias Tonela and Michael Kearns, Director of GL Africa Energy.

The deal signals the start of a three-part phased investment. Initial phase will create 50MW capacity within 16 months. The second and third phases will add 200MW in total and will be completed within 24 months.

GL Energy Moçambique is the special purpose vehicle for the deal. The company, a subsidiary of GL Africa Energy, will build and operate the plant upon its completion. The terms of the project and concession agreement received requisite approval by the Mozambican Cabinet on 7th October, 2021 before being officially signed today.

The deal is structured as a 30-year Public-Private-Partnership (PPP). EDM (Electricidade de Moçambique) will hold the initial public interest of the project and will be the off taker for the electricity generated. The project is a key pillar of the Mozambique Government’s gas monetization strategy.

Domestically, the plant will improve electricity supply in a country where approximately 40% of the population have no access to reliable source of electricity. The company also hopes this investment will support the country’s plan to turn the region into a viable trading hub. Over 300 workers will be employed during construction.

The plant’s LNG solution provides an almost instant bridge fuel throughout the next two decades, reducing reliance on more polluting HFO, diesel and coal. LNG is set to play a crucial role in the transition towards renewables for the country and the region, enabling a higher penetration of renewables into the energy mix in the long term.

Mamadou Goumble, CEO Energy Business, JCG

“We are delighted to take another step towards completing the Nacala LNG plant. It is a historic milestone for the region. Power and development go hand-in-hand, and we are so proud to play our part in supporting the communities of Nacala. This plant will ensure reliable power for tens of thousands of businesses and homes. It will change the lives and fortunes for Mozambicans.

“We’re thankful to our partners in the Government of Mozambique for backing our vision. It demonstrates the power of public and private collaboration. It is just the beginning of our long-term commitment to the country.”

Author: Bryan Groenendaal

Wärtsilä dual-fuel engine like this one will be capable of transitioning to future fuels, including pure hydrogen and ammonia, future-proofing customer assets. Image credit: Wärtsilä

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