February 2020, Vol. 247, No. 2


Emerging Offshore Pipeline Market in Southern Africa

By Shem Oirere, Correspondent

The increasing exploration for and discovery of oil and gas reserves offshore Africa has raised prospects of growth of the continent’s offshore pipelines market. 

The southern African country of Mozambique, where discoveries of between 130 Tcf and 180 Tcf (3.68 Tcm and 5.10 Tcm) of natural gas have been made, has unveiled two huge liquefying projects to commercialize the reserves.

These projects will open additional investment opportunities for the growth of not only the domestic offshore pipeline industry but across Africa, where an estimated $1.3 billion is needed for gas and petroleum product pipelines, according to the Programme for Infrastructure Development in Africa (PIDA).

The confirmation in September of the acquisition of Anadarko Moçambique Area 1, Lda, a wholly owned subsidiary of Anadarko Petroleum Corporation, which had pioneered the Mozambique Liquefied Natural Gas (MLNG) project by Occidental Petroleum, paved the way for progressing the $20 billion-plus undertaking. The project will include more than 28 miles (45 km) of pipeline to transport raw natural gas extracted from deepwater production wells in the Golfinho-Atum gas field.

French energy giant Total SA has now taken over the Anadarko interest in the LNG project after striking a deal with Occidental Petroleum, but it is expected that much of the earlier final pipeline network component design will be retained as the massive hydrocarbons projects inch closer to full implementation.

Total has indicated interest in proceeding with the natural gas monetization scheme with a capacity of 12.88 mtpa during the first phase, which is likely to commence in 2024.

The World Bank predicts a positive jolt of Mozambique’s economy resulting from the project because of the expected “increased fiscal revenues, and foreign investment, upstream and downstream linkages with local industries, and capacity development in the gas sector.”

According to an earlier plan for the MLNG project initiated by Anadarko, the corridor path will proceed from the seabed where the Golfinho-Atum deepwater natural gas fields will be drilled in Area One, located nearly 25 miles (40 km) off the Mozambican coastline.

The fields have estimated recoverable natural gas reserves of 75 Tcf (2.12 Tcm), which experts predict will take 120 years to exhaust, at the rate of 12.88 mtpa.

“As the pipelines approach the coastline, they will be routed in a single pipeline corridor and enter Palma Bay between the islands of Rongui and Tecomaji,” stated in a project brief by MLNG.

“The pipeline system will be designed to allow for the tie-in of additional pipelines to accommodate future expansion,” it says. The projected expansion is likely by 2028, according to MLNG. This would mean expansion and upgrade of the onshore control system as the more than 6 Bcf/d (170 million cubic meters) of gas envisaged in the initial project phase could be exceeded.

Although there are no latest updates on the initial subsea pipeline system installation, it is expected that the pipelines, like many similar offshore oil and gas conveying infrastructure, will be made of carbon steel or related material, delivered in single joints of 40 feet to 120 feet (12 meters to 37 meters).

The initial MLNG pipeline system installation plan proposes deploying a purpose-built DP lay barge for the laying of the pipeline, using either the J-lay or S-lay method depending on the prevailing ambient conditions.

Adjacent to the shoreline, MLNG says a channel, 984 feet (300 meters) wide and 16.4 feet (5 meters) deep, will be dredged “to accommodate access by the lay barge to install the pipelines.”

“In water depths of greater than 82 feet [25 meters] at lowest astronomical tide, the pipelines will be laid directly onto the seabed without the need for dredging,” added MLNG.

The MLNG pipeline system is likely to share the seabed corridor with a similar network for the separate Rovuma LNG project that will use natural gas from the deepsea Mamba fields.

The Rovuma facility, which will “produce, liquefy and market natural gas, comprises the construction of onshore facilities, including two LNG trains with a total capacity of 15.2 mtpa [with] LNG production expected to start in 2025.”

The liquefaction plant is being developed by Mozambique Rovuma Venture S.p.A (MRV), comprising ExxonMobil, Eni and China National Petroleum Corporation (CNPC), which hold 70% stake in the project, while Mozambique’s Empresa Nacional de Hidrocarbonetos de Mocambique (ENH, Galp and Kogas) each have a 10% share.

In September, MRV was awarded a contract for the engineering, procurement and construction of the first phase of Rovuma LNG’s onshore LNG facilities to JFT, a consortium of JGC, Fluor and TechnipFMC.

At least three 22-inch (559-mm) pipelines will deliver raw gas and associated liquids for the Rovuma LNG from the Mamba deepsea gas fields, estimated to hold up to 85 Tcf (2.4 billion cubic meters) for processing at the liquefaction facility located onshore.

However, for both the MLNG and Rovuma LNG projects, it is not yet clear which companies will supply the pipes, carry out welding, apply coatings, and handle subsequent pipeline operation and maintenance contracts. Clarification will emerge as the projects progress.

Nevertheless, Mozambique’s offshore pipeline infrastructure network, thought short, is seen as a major complement to the previous major gas pipeline projects in the country that are largely spearheaded by South Africa chemical giant Sasol Ltd.

The latest of the pipeline projects is the $210 million Loop Line 2 (LL2) by Republic of Mozambique Pipeline Investments Company [(ROMPCO – a JV between Sasol Gas Holdings, the South African Gas Development Company (iGas) and Companhia Moçambicana de Gasoduto S.A.R.L (CMG)]. It entails capacity expansion of the existing 537-mile (865-km) gas pipeline that transports gas from the Central Processing Facility (CPF) in Mozambique’s Temane area to Secunda in South Africa.

The Loop Line 2 pipeline that starts at Scraper Station 1, nearly 80 miles (128 km) from the CPF, will run back to the main pipeline at Scraper Station 2. It supplements the $200 million Loop Line 1, which was completed in 2014.

With the discovery of significant hydrocarbons at the Kaombo ultradeep offshore project in Angola by French major Total SA and another significant discovery by the same company in its South Africa Brulpadda Block, the emerging offshore pipeline industry in Mozambique could be but only a beginning of the growth of a huge oil and gas pipeline market in sub-Saharan Africa.

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