MOZAMBIQUE – Total SA’s giant Mozambique gas project will get a US$400 million loan from the African Development Bank, adding to its list of backers as the African nation works to establish a fuel-export industry.

The AfDB joins a global syndicate of commercial banks, development finance institutions and export credit agencies to provide senior debt financing for the project, the lender said. 

According to Club of Mozambique, Mozambique is counting on the US$23 billion development to revive its economy after struggling to service its debts.

Financial close is expected in the first half of 2020, the AfDB said in a statement. French major Total operates the liquefied natural gas project with a 26.5% interest, after snapping up Anadarko Petroleum Corp.’s African assets earlier this year. 

A final investment decision was announced in June, and production is expected by 2024, Total said in September.

The project includes the development of offshore gas fields in Mozambique’s Area 1 and a two-unit liquefaction plant with capacity of 12.9 million tons a year. 

The site will eventually have as many as eight production units, Total Chief Executive Officer Patrick Pouyanne said last month.

Mozambique is set to become one of the largest exporters of LNG, with sales from Area 1 supplemented by an adjacent Exxon Mobil Corp. project in Area 4. The U.S. company plans to take a final investment decision on its 15.2-million-ton-a-year venture in 2020.

AfDB President Akinwumi Adesina said: “Through its participation, the African Development Bank again demonstrates its leading role in supporting Africa’s transformation. 

“The catalytic effect brought about by the Bank is strategically aimed to help transform Mozambique from ‘developing’ to ‘developed’ nation.”

“Working closely with the Government of Mozambique, we can ensure that the local population reaps the benefits from its nascent natural gas value-chain, thus creating growth opportunities and widespread industrialization, while at the same time accelerating regional integration across Southern Africa,” he added.

The LNG liquefaction plant will have a production capacity of 12.88 MTPA. The Project is the first of several LNG trains expected to undergo development in the northern part of the country.

Mozambique is expected to become one of the world’s largest LNG exporters and its gas represents an important source of supply diversification, which stands to benefit global energy markets.

With the new backing, AfDB joins a global team of energy developers and operators, led by Total alongside Mitsui, Oil India, ONGC Videsh Limited, Bharat Petroleum, and PTT Exploration, as well as Mozambique’s national oil and gas company ENH.

The International Monetary Fund (IMF) has projected Mozambique’s economy to record a strong recovery in 2020 with real growth of 5.5%, compared to 2.1% expected for this year.