CMH’s Perspective for the Future
The expansion project
The expansion project will entail an additional investment on the part of CMH of approximately seventy five million dollars in order to keep its participating interest (twenty five percent) in the consortium owning the Pande and Temane Natural Gas Enterprise as indicated in the table below:
| Initial 2000 - FY06 | Period FY07 - FY08 | Future Projections FY09 - FY18 | Total | |
|---|---|---|---|---|
| Sales:Natural Gas | 41.916.740 | 66.922.919 | 869.908.167 | 978.747.826 |
| Sales: Condensed | - | 20.791.856 | 74.674.513 | 95.466.379 |
| Sales: LPG | - | - | 11.959.850 | 11.959.850 |
| Royalties:Natural Gas | 2.074.365 | 1.215.551 | 15.899.420 | 19.189.337 |
| Royalties: Condensed | - | 761822 | 3.733.726 | 4.495.548 |
| Royalties: LPG | - | - | 597.993 | 597.993 |
| Net Revenue | 39.842.375 | 85.737.411 | 936.311.392 | 1.061.891.178 |
| operating costs | 5.154.441 | 11.180.840 | 83.353.347 | 99.688.628 |
| Other Income and Expenses | - | 2.098.642 | 99.688 | 1.998.954 |
| Result | 34.687.934 | 72.457.929 | 853.057.733 | 960.203.596 |
For the purpose of financing the expansion program a study is now being prepared and there are ongoing negotiations with the present and potential new lenders, in order to determine the conditions for obtaining the said financing package.
Other Oportunities
CMH’s objective is to maintain the optimum level of utilization of the Pande and Temane gas and to ensure its availability to Mozambican citizens. To this end a series of investment projects are under consideration for future implementation that will contribute to the development of the enterprise, such as:
Pruduction of domestic gas (LPG) - this project will be developed by the consortium formed by CMH, Sasol and IFC using the Pande and Temane gas. The initial production capacity will be 5,000 tons p.a. which could increase to 20,000 tons p.a. depending on the results of research being carried out at the Inhassoro Sector
Production of Electric Power in Mozambique - studies are being carried out on the use of Pande and Temane gas for the generation of electrical power. This power is primarily intended for local consumption but could be exported as well. CMH is considering the option to join the promoters of this investment.
The use of natural gas in iron production – this project is being analysed by the Ministry for Industry and Trade and needs confirmation of the existence of additional gas resources in order to guarantee its viability. CMH is closely following the development of this project as it will contribute to maximize the use of natural gas in the country.
The use of Condensate – besides being marketed internationally as a fuel, condensate may be used in the country to generate electrical power. If the condensate is rich in heavy elements it may also be used in the petrochemical and plastic industries.
Sectors Licensed for Surveying – recently several sectors in the Mozambique and Rovuma Basins were licensed. If gas is found, these additional quantities will allow the development of new projects to export compressed or liquefied gas or gas transformed into diesel fuel or petrol. Since CMH is a company with experience in this field it will designate a preferential agent to constitute partnerships in order to develop those sectors where the existence of gas has been confirmed.