US EXIM Bank Approves US 5 Billion for Mozambique LNG Project

  • The Export-Import Bank of the United States (EXIM) today voted unanimously to authorise a direct loan of up to US5 billion for the engineering, procurement, and construction of an onshore LNG plant Afungi Peninsula in northern Mozambique.
  • EXIM’s financing will support U.S. exports of goods and services and related facilities.

The transactions will support an estimated 16,400 American jobs over the five-year construction period, including jobs at suppliers in Texas, New York, Pennsylvania, Georgia, Tennessee, Florida, and the District of Columbia. Through follow-on sales, thousands of additional jobs are likely to be generated across the United States.

Through fees and interest earned, the transaction is also anticipated to generate more than $600 million in revenue for U.S. taxpayers, according to EXIM projections.

“In addition to supporting our U.S. workers here at home, there also is little doubt that this transaction will be transformative for the people of Mozambique. It is currently forecast that the life of project will have a net benefit of more than $60 billion, which is more than four times the current gross domestic product of Mozambique. In addition, the project is obligated to provide domestic gas, which will support the expansion of electric generation capacity and the development of other industries in the country,” said EXIM President and Chairman Kimberly A. Reed.

The borrower is Mozambique LNG1 Financing Company Ltd., which is owned by a group of sponsors, formerly including Anadarko Petroleum Company that earlier this year was acquired by Occidental Petroleum Corporation. Occidental is expected to sell the African assets acquired to a multinational oil and gas company, Total S.A. However, the U.S. content requirement of the contract supported by EXIM will continue to apply, and the related EXIM-supported goods and services to the project will be provided by the United States.

Chairman Reed noted that EXIM is working with the agency’s Sub-Saharan Africa Advisory Committee to ensure that EXIM’s policies and procedures meet the needs of U.S. companies and their workers, and also benefit America’s trading partners in sub-Saharan Africa.

Author: Bryan Groenendaal

Source: EXIM Bank 

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