AfDB Approves $150m Loan for Mozambique’s Coral North Floating LNG Project

Coral North is expected to significantly expand Mozambique’s liquefied natural gas production capacity while delivering long-term economic and energy security benefits.

The Board of Directors of the African Development Bank (AfDB) has approved a $150 million senior loan to support the development of the Coral North Floating Liquefied Natural Gas (FLNG) Project, a major offshore energy infrastructure initiative set to strengthen Mozambique’s role in the regional and global gas market.

The loan was approved on 14 January and builds on the success of the Coral South FLNG project, which became operational in 2022. Coral North is expected to significantly expand Mozambique’s liquefied natural gas production capacity while delivering long-term economic and energy security benefits.

Expanding Offshore LNG Capacity in Cabo Delgado

Located approximately 55 kilometres offshore from northern Mozambique’s Cabo Delgado province, the Coral North FLNG Project will involve the development, construction and operation of a floating LNG facility with an annual production capacity of 3.55 million metric tonnes.

The project is led by Italian energy giant Eni S.p.A., which has extensive global experience in LNG development and operations. The total project cost is estimated to exceed $7 billion.

In addition to AfDB financing, funding will be provided by a consortium of development finance institutions, export credit agencies and commercial lenders, reflecting strong international confidence in the project’s commercial and strategic viability.

Significant Economic and Fiscal Impact

Coral North is expected to generate more than $20 billion in fiscal revenues over its operational lifetime, providing a substantial boost to Mozambique’s public finances. The project is also expected to deliver wide-ranging economic benefits, including job creation during both the construction and operational phases.

Officials said the development will create significant short-term employment opportunities during construction, as well as permanent skilled jobs once the facility becomes operational, contributing to capacity-building and skills transfer within the local workforce.

Supporting Regional Energy Security and Development

A key feature of the Coral North FLNG Project is its commitment to allocate a portion of LNG production to support domestic and regional development priorities. These include clean cooking access, domestic industrial development, gas exports to the Southern African Development Community (SADC) region, and the development of gas-to-power projects.

These initiatives are expected to enhance regional energy security, support industrialisation and improve resilience across Southern Africa, where demand for reliable and cleaner energy sources continues to grow.

The project will also increase Africa’s contribution to global LNG supply, allowing the continent to benefit from rising international demand while strengthening Mozambique’s position as a leading energy hub within the SADC region.

Landmark Energy Transition Project

Coral North FLNG is being positioned as a landmark project in Africa’s evolving energy transition. Building on earlier LNG investments in Mozambique, the project reinforces the country’s emergence as a global LNG supplier while delivering tangible socio-economic benefits.

These include increased fiscal revenues, job creation, enhanced energy security and the development of climate-resilient energy infrastructure that supports sustainable industrialisation.

The African Development Bank said its support underscores a commitment to balancing energy security with climate resilience, ensuring that Africa’s natural gas resources are leveraged to support inclusive growth and long-term development across the continent.