Eni attracts substantial funding interest for next floating LNG plant

(WO) — Eni SpA has received substantial interest for its next floating liquefied natural gas project in Mozambique, even as international lenders face growing pressure to reduce exposure to fossil fuels.

Luca Vignati, director of Eni’s upstream business, said in an interview that the plant will cost about the same as its $7 billion Coral South project, inaugurated in 2022. Investment decisions for the new plant could be in place as soon as this quarter, he said. 

While oil projects are facing growing challenges to find financing as the world moves toward decarbonization, gas is a cleaner burning fuel and seen as part of the energy transition. Potential lenders of Coral North include the US Export-Import Bank, which has listed the project as pending on its website.

“Financing from international institutions and first investors are there for more than what we needed,” Vignati said this week in Cape Town. Coral South’s reliable output since its start means that banks considering the Coral North plant “see something that is running.”

The new vessel will be identical to its sibling, but Eni will be able to squeeze 5% more LNG from it, Vignati said. That would take production to 3.6 million tons of LNG per year. 

It is located in the nation’s Area 4 concession. Partners include ExxonMobil Corp., China National Petroleum Corp., Abu Dhabi National Oil Co, Korea Gas Corp. and Mozambique state producer Empresa Nacional de Hidrocarbonetos E.P. 

"Approval by the government could be finalized in the coming weeks. To speed up the timeline, Eni has booked space in a shipbuilding yard and long-lead items have already been ordered," said Vignati.    

While Eni’s projects has attracted plenty of interest, funders of TotalEnergies SE’s $20 billion onshore facility in the nation — put on hold in 2021 because of a violent insurgency — still need to reaffirm commitments. "The firm is focused on developing the project once the security situation is resolved," said Chief Executive Officer Patrick Pouyanne.