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ExxonMobil Corporation (XOM - Free Report) is finally moving ahead with its Rovuma liquefied natural gas (LNG) project in Mozambique. The company seems optimistic about the project and expects to seek a final investment decision at the end of 2025. The Rovuma LNG project is being developed by ExxonMobil, along with EniSpA (E - Free Report) .
While XOM will be responsible for the construction and operation of the onshore liquefaction and related facilities, Eni will focus on the Coral floating LNG and upstream operations. The Rovuma LNG project is located offshore Area 4 in northern Mozambique.
In 2021, TotalEnergies declared force majeure on its Area 1 Mozambique LNG plant because of an offensive by Islamic State-linked insurgents that threatened its facility. This decision also affected ExxonMobil’s operations as they relied on the development of shared and common facilities, such as an LNG jetty and offloading facility.
Although XOM recognizes the existing challenges in the region, it remains optimistic and believes that these hurdles can be successfully navigated through shared effort. The company is moving forward with the LNG project and expects it to enter a front-end engineering and design (FEED) phase in the coming months.
To address environmental concerns and the needs of the current business landscape, the project, which was initially designed for 15 million metric tons per annum (mtpa), has been revamped to a modular, electric LNG plant with an 18 million mtpa capacity. According to ExxonMobil, the newly designed project is likely to offer greater flexibility and produce less harmful emissions.
Credit Agricole, an international financial institution, denied funding two major LNG projects, including Rovuma. The company cited its commitment to refrain from any new development in the fossil fuel sector, as the reason behind its denial.
ExxonMobil has noted that the security concerns in Mozambique have improved a lot following the intervention of a regional military force and military support from Rwanda. However, the developments in the Cabo Delgado province are being monitored closely in the light of a new wave of attacks launched by the Islamic State-linked militants this year.
SM Energy is an upstream energy firm operating in the prolific Midland Basin region and the South Texas region. For 2024, the company expects its production to increase from the prior-year reported figure, signaling a bright production outlook.
Hess is a leading upstream energy company, with its operations focused on the prolific resources offshore Guyana. The company has made significant oil discoveries in the Stabroek Block, off the coast of Guyana. These discoveries have totaled more than 11 billion barrels of oil equivalent in gross recoverable resources, adding to Hess’ production potential.
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ExxonMobil's (XOM) Optimism Forwards Rovuma LNG Project
ExxonMobil Corporation (XOM - Free Report) is finally moving ahead with its Rovuma liquefied natural gas (LNG) project in Mozambique. The company seems optimistic about the project and expects to seek a final investment decision at the end of 2025. The Rovuma LNG project is being developed by ExxonMobil, along with Eni SpA (E - Free Report) .
While XOM will be responsible for the construction and operation of the onshore liquefaction and related facilities, Eni will focus on the Coral floating LNG and upstream operations. The Rovuma LNG project is located offshore Area 4 in northern Mozambique.
In 2021, TotalEnergies declared force majeure on its Area 1 Mozambique LNG plant because of an offensive by Islamic State-linked insurgents that threatened its facility. This decision also affected ExxonMobil’s operations as they relied on the development of shared and common facilities, such as an LNG jetty and offloading facility.
Although XOM recognizes the existing challenges in the region, it remains optimistic and believes that these hurdles can be successfully navigated through shared effort. The company is moving forward with the LNG project and expects it to enter a front-end engineering and design (FEED) phase in the coming months.
To address environmental concerns and the needs of the current business landscape, the project, which was initially designed for 15 million metric tons per annum (mtpa), has been revamped to a modular, electric LNG plant with an 18 million mtpa capacity. According to ExxonMobil, the newly designed project is likely to offer greater flexibility and produce less harmful emissions.
Credit Agricole, an international financial institution, denied funding two major LNG projects, including Rovuma. The company cited its commitment to refrain from any new development in the fossil fuel sector, as the reason behind its denial.
ExxonMobil has noted that the security concerns in Mozambique have improved a lot following the intervention of a regional military force and military support from Rwanda. However, the developments in the Cabo Delgado province are being monitored closely in the light of a new wave of attacks launched by the Islamic State-linked militants this year.
Zacks Rank and Key Picks
Currently, XOM has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the energy sector are SM Energy (SM - Free Report) and Hess Corporation (HES - Free Report) . SM Energy and Hess presently sport a Zacks Rank #1 (Strong Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
SM Energy is an upstream energy firm operating in the prolific Midland Basin region and the South Texas region. For 2024, the company expects its production to increase from the prior-year reported figure, signaling a bright production outlook.
Hess is a leading upstream energy company, with its operations focused on the prolific resources offshore Guyana. The company has made significant oil discoveries in the Stabroek Block, off the coast of Guyana. These discoveries have totaled more than 11 billion barrels of oil equivalent in gross recoverable resources, adding to Hess’ production potential.