Sasol and ENH study FSRU terminal for southern Mozambique

South Africa’s petrochemicals firm Sasol and Mozambique’s state-owned ENH have signed a memorandum of understanding to assess the feasibility of an FSRU-based liquefied natural gas (LNG) terminal in southern Mozambique. The project points to a new discharge destination for LNG carriers in a region racing to secure gas supplies for industrial use.

Sasol and ENH will jointly evaluate the technical and commercial viability of the floating storage and regasification unit (FSRU). The terminal would be located in the southern part of Mozambique, positioned to serve both local and regional markets.

Why it matters

An FSRU in southern Mozambique changes the logistics for regional energy. Sasol is a major petrochemical player with existing infrastructure in both countries, and this terminal would likely feed into its industrial network. For LNG shipowners and FSRU operators, this represents a concrete opportunity in a market that has historically relied on domestic production or coal.

The timing is critical as South Africa’s Transnet National Ports Authority (TNPA) simultaneously advances plans for its own LNG terminal at the Port of Ngqura. These two projects may end up competing for the same pool of regional industrial off-takers. A terminal in southern Mozambique could potentially offer a more direct route to Sasol’s primary operations than a South African port.

The choice of an FSRU over a land-based terminal suggests the partners want to minimize lead times. For the maritime sector, this means a likely requirement for a long-term FSRU charter and regular shuttle deliveries from LNG carriers, rather than the static infrastructure of a traditional terminal.

What to watch

The outcome of the feasibility study will determine if the partners move to a final investment decision or if the project yields to South Africa’s competing Ngqura terminal.

Source: LNG Prime