SUEUN Provides $500 Million PF Financing for Mozambique Gas Field Development and LNG Plant Project

Export-Import Bank Provides $500 Million PF Financing for Mozambique Gas Field Development and LNG Plant Project

On the 28th, a COVID-19 confirmed case occurred at the Korea Eximbank in Yeongdeungpo-gu, Seoul. / Photo by Mun Ho-nam munonam@

[Asia Economy Reporter Kim Hyo-jin] The Export-Import Bank of Korea announced on the 10th that it will provide $500 million in project financing (PF) for the development project of Mozambique Offshore Block 1, in which Daewoo Engineering & Construction and others are participating.

Our small and medium-sized enterprises (SMEs) and mid-sized companies, including Daewoo Engineering & Construction, will participate in the construction of the LNG plant for this development project with a total scale of $550 million.

The financial support from the Export-Import Bank of Korea is expected to be used for payment of construction fees to domestic companies participating in this project, contributing to the creation of about 1,300 jobs annually and earning foreign currency through exports of domestically produced equipment.

This project involves eight project owners, including the French company Total and Mozambique National Hydrocarbon Company (ENH), developing gas fields within Mozambique Offshore Block 1, constructing and operating two liquefied natural gas (LNG) plants, and selling the LNG produced here through long-term contracts.

The total project cost is approximately $23.5 billion, and upon completion, it is expected to produce about 12.9 million tons of LNG annually.

Major export credit agencies from eight countries, including the Export-Import Bank of Korea, the US Export-Import Bank, the Japan International Cooperation Bank, Japan Trade Insurance, the UK Export Finance, and the Italian Export Credit Agency, have participated as lenders in this project to support their domestic companies.

In particular, while the current project owners are negotiating contracts for the construction of 17 LNG carriers (worth about $3 billion) with Hyundai Heavy Industries and Samsung Heavy Industries, the Export-Import Bank of Korea’s support is expected to lead to additional LNG carrier orders for domestic shipbuilders. It is also significant that this establishes a foundation for the joint entry of SMEs and mid-sized companies into the African market, which is emerging as a resource-rich developing country with great growth potential.

An official from the Export-Import Bank of Korea said, “Although external conditions such as COVID-19, global economic recession, and reduced orders remain challenging, we expect that this financial support will be a good opportunity to enhance the competitiveness of our companies in securing orders in emerging markets by preempting the African resource development market.”

This content was produced with the assistance of AI translation services.