Field/project development

Sasol Seeks EPCM Contractor for Mozambique LPG Project

With one of the world’s lowest electrification rates, Mozambique is moving to give its citizens a brighter future. Together with South Africa’s Sasol, the country endeavors to attract global EPCM companies and international financing to create a power generation hub fueled by gas from onshore fields.

An operator at a Sasol refinery in Mpumalanga Province, South Africa.
An operator at a Sasol refinery in Mpumalanga Province, South Africa.

Sasol Petroleum Mozambique has opened bidding for engineering, procurement, and construction management (EPCM) firms to provide services on the South African company’s production-sharing agreement (PSA) license area in Mozambique’s Inhambane province.

Potential bidders must be registered in Mozambique and must file documents with Sasol electronically by 13 January 2021, according to industry reports.

Sasol is seeking a company to design, procure, and construct a processing facility, with LPG storage and dispatch capability. The plant will be located next to the central processing facility in Temane, 600 km north of the capital city of Maputo.

The contract will cover new oil stabilization, gas processing and an LPG production facility, water treatment package units, utility package systems, and related interfaces.

Sasol plans to produce LPG for domestic consumption around the relatively undeveloped Temane area, while it also supplies gas to operate the future Central Termica de Temane (CTT) electric power project. The Inhassoro, Temane, and Pande fields included in the PSA license area will provide the resource base.

In February 2020, Sasol reworked its original PSA development plan, which the Mozambique government had approved in 2016, after drilling results that same year fell short of expectations.

Sasol has worked on the Inhambane license area since 2000. It drilled the Inhassoro-2 well in 2003 and the Inhassoro-6 in 2006 and discovered light oil. Amec Foster Wheeler had won the detailed design and engineering contract for the first phase of surface development in 2016.

Earlier in 2020, Sasol had asked for bidders to register interest in the provision of coated line pipe and hot induction bends.

On the power generation side, Spain’s TSK has been appointed to design and construct the CTT power facility with financial arrangements expected to close by Q2 2021. First power is anticipated in Q4 2023.

TSK will build the 450-MW power plant using Siemens turbines. CTT will provide power to Electricidade de Moçambique (EDM) under a 25-year tolling agreement. Globeleq, which is an independent power producer operating and developing power projects in Africa, leads the project group together with state-owned EDM, Sasol, and eleQtra.

CTT will receive funding of up to $200 million from the US International Development Finance Corporation and up to $50 million from the OPEC Fund for International Development once loan agreements and other closing conditions are finalized next year.

The International Finance Corporation is expected to provide the balance of the required debt financing and is in the process of finalizing its approvals.

CTT will anchor the development of the 563-km high-voltage transmission line and associated transmission infrastructure (the Temane Transmission Project or TTP) which will eventually carry power to Maputo, home to 1.2 million people.