South Africa’s Gigajoule expects to import first LNG cargo at new Mozambique terminal by mid-2025

• The Matola terminal could become South Africa’s first major LNG supplier.

South African energy company Gigajoule is confident of reaching financial closure by year-end ahead of construction of its $550 million Matola LNG import terminal in Mozambique with joint development partner TotalEnergies TTEF.PA, the chief executive of the privately-held firm said on Thursday.

The liquefied natural gas (LNG) terminal, which also has Mozambican shareholders, is expected to receive its first shipments of gas to a permanently moored floating storage and regasification unit in Matola harbour, close to Mozambique’s capital Maputo, by mid-2025, CEO Jurie Swart said on the sidelines of a gas conference in Cape Town.

The Matola terminal could become South Africa’s first major LNG supplier at a time government wants to significantly expand its domestic gas market but faces a gas supply crunch as onshore gas fields operated in Mozambique by Sasol start running dry within a few years.

Sasol’s Tande and Temane fields in southern Mozambique supply the bulk of South Africa’s gas needs via the 865 km Rompco pipeline. According to domestic industry body IGUA’s 2021 annual report, South Africa currently faces a gas supply shortfall of some 170 petajoules a year.

“Our realistic case is that construction for the LNG import facility will start in January next year and first gas is seen mid-2025,” chief executive Swart told Reuters.

He said Gigajoule, which is also co-developing a 2 000 megawatt gas-to-power plant close to Matola, intends to link the terminal to the Rompco pipeline to supply gas to South Africa.

“Financing is not that difficult … in the commercial market that we’ve canvassed for both these projects we think we’ve got full subscription from all the major commercial banks in South Africa and export credit agencies,” Swart said.

Matola is independent from Total’s $20 billion LNG development to the north of Mozambique that was disrupted by violence caused by insurgents linked to Islamic State, although the French oil major expects to restart the project this year.

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