The African Development Bank and the Mozambique Liquefied Natural Gas (LNG) Area 1 Project have been jointly awarded the prestigious Global Multilateral Deal of the Year 2020 award by the Project Finance International (PFI).
The AfDB disclosed this in an email statement seen by Nairametrics on Thursday evening.
The Multilateral bank disclosed that the project is the largest foreign direct investment in Africa to date with a value of over $24 billion, and “will exploit Mozambique’s immense offshore natural gas reserves, which can potentially transform global energy markets. “
The AfDB said signed an agreement for a $400 million senior loan to finance the project in July 2020, joining global syndication of commercial banks and export credit agencies that are providing financing.
AfDB said the Mozambican project will boost the country’s ability to meet energy demand through gas-fired electricity and will support its ambitious goal to provide universal access to energy to its citizens by 2030.
“The project can also potentially feed downstream industries that use natural gas, such as fertilizer and electricity producers. It can thus become an engine for agricultural development and trade across the Southern African Development Corporation region,” they said.
What they are saying
“I still find it remarkable how so many project financings were transacted this year, including the Mozambique LNG deal,” said PFI’s Editor Rod Morrison. “The multilaterals played a key role in getting the project financed.”
AfDB President, Dr. Akinwumi A. Adesina, said he is delighted that the Bank won the award as it reinforces the Bank’s ability to attract large investments to Africa.
“I am delighted with the award of the Global Multilateral Deal of the Year 2020 to the African Development Bank and the Government of Mozambique LNG Area 1 Project, by Project Finance International,” he said.
“This great recognition reinforces the African Development Bank’s leadership and role in helping to structure financing and attract investments to Africa.
“The $24 billion project, which was structured at the Bank’s Africa Investment Forum, is Africa’s largest foreign direct investment. We will work with all partners to ensure that this project helps to unlock greater economic growth for Mozambique and benefits millions of people in the country, while building climate resilience,” he added.
Fernando Balderrama, AfDB Chief Investment Officer said the Bank is excited about the growth and industrialization opportunities created through this project for the Mozambican population.
“The African Development Bank will continue to play a convening role to facilitate and assist with the suitable implementation of this investment, advocating for international best practice, small and medium enterprise development and diversification, women’s empowerment, job creation, and other critically important considerations,” Balderrama said.
In case you missed it
- Nairametrics reported in July last year that the largest private investment in Africa, Total’s Mozambique liquefied natural gas project neared a $16 billion financing from major banks including the AfDB which will provide $400 million worth of loans, while Japan’s Japan Bank for International Cooperation will provide up to $3 billion in loans for the project.
- Total expects Mozambique to earn up to $50 billion in Natural gas revenue for the next 25 years when the project is completed, added to the Rovuma LNG built by Exxon in the same location.