EXIM Board Votes to Notify Congress of Proposed $5 Billion Financing to Support U.S. Exports to Mozambique LNG Project
August 22, 2019
(Ex-Im Bank)
EXIM Financing Could Support an Estimated
16,400 American Jobs
Washington, D.C. – The board of directors of
the Export-Import Bank of the United States
(EXIM) today voted to notify the U.S. Congress,
pursuant to the EXIM charter, of its
consideration of a $5 billion direct loan to
support the export of U.S. goods and services
from multiple states for the development and
construction of an integrated liquefied natural
gas (LNG) project located on the Afungi
Peninsula in northern Mozambique.
At the conclusion of a 35-day congressional
notification period, the transaction may be
considered for a final vote by EXIM’s board
of directors. Members of the public may also
provide comments on the transaction by
September 16 (link is external).
If finally approved, the transaction would
support U.S. exports of goods and services for
the engineering, procurement, and construction
of the onshore LNG plant and related
facilities. These U.S. exports are facing
direct competition from financing offered by
foreign export credit agencies.
EXIM’s financing could support an estimated
16,400 American jobs over the five-year
construction period, including jobs at
suppliers in Texas, Pennsylvania, Georgia, New
York, Tennessee, Florida, and the District of
Columbia. Through follow-on sales, thousands of
additional jobs may be generated across the
United States.
Through fees and interest earned, the
transaction also could create more than $600
million in revenue for U.S. taxpayers,
according to EXIM projections.
The Mozambique LNG project would begin to
develop the Rovuma Basin, one of the world’s
most extensive untapped reserves of natural
gas. The project is anticipated to have a
transformative impact on Mozambique’s economy
during the expected operational period of the
project.
If finally approved, EXIM’s financing would
support U.S. exports to the Area 1 concession
of the Mozambique LNG project, which covers
approximately 10,000 square kilometers and is
anticipated to supply up to 64 trillion cubic
feet of gas. The borrower would be Mozambique
LNG1 Financing Company, which is owned by a
group of sponsors, including Anadarko Petroleum
Company that was recently acquired by
Occidental Petroleum Corporation.
This transaction, if approved, also would
further the Trump Administration’s Prosper
Africa Initiative, a whole-of-government
economic initiative to substantially increase
two-way trade and investment between the United
States and Africa. Launched in December 2018,
Prosper Africa brings together the resources of
more than 15 U.S. government agencies,
including EXIM, to unlock opportunities to do
business in Africa and advance American and
African prosperity and security, support jobs,
and demonstrate the superior value of
transparent markets and private enterprise for
driving growth.
“With the backing of the Trump
Administration, U.S. investment in Africa has
taken on a new urgency,” said Secretary of
Commerce Wilbur Ross, an ex officio member of
EXIM’s board of directors. “This critical
project is not only a win for American
companies and workers, supporting over 10,000
jobs in the United States, but also for the
people of Mozambique as well.”
“America’s energy companies offer the best
goods and services in the world,” said U.S.
Trade Representative Robert Lighthizer, also an
ex officio member of the EXIM board. “I am
pleased that, with this vote by the EXIM board
of directors, ‘Made in the USA’ products
are poised to play an important role in the
development of this important energy
resource.”
Global demand for LNG is expected to continue
to rise significantly. The LNG to be exported
by the Mozambique LNG project is targeted
primarily to meet the demand of Asian markets.
EXIM staff conducted a detailed economic impact
analysis of the transaction and found that it
likely will have a net positive impact on the
economy of the United States.
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