East Africa's LNG investors weigh up decision plans

Subject

LNG outlook in East Africa.

Significance

No final investment decisions (FID) have been taken for any of East Africa's prospective liquefied natural gas (LNG) projects. In the current low price environment, further cuts to capital expenditure by development partners are possible. Given the uncertain global outlook, gas players may need several more reassurances before they advance to FID, and secure the region's future as a major offshore gas producer.

Impacts

• Future government revenues from these projects are necessary to improve Mozambique and Tanzania's fiscal standing.
• Donor funding to the region is on a downward trajectory, increasing the level of non-concessional lending.
• If FIDs are delayed beyond the next few years, Mozambique in particular will face debt distress.