What is LNG and why is it important?

LNG stands for Liquefied Natural Gas, which is natural gas that has been cooled to -260°F (-162°C), turning it into a liquid. This process reduces its volume by about 600 times, making it much easier and more economical to transport across long distances, especially where pipelines aren't practical. LNG is important because it's considered a cleaner fossil fuel alternative to coal and oil, producing fewer emissions when burned. The Mozambique project is significant because it represents one of Africa's largest natural gas developments and could transform Mozambique's economy while supplying energy to markets across Asia and Europe.

What caused the 4-year suspension of the Mozambique project?

The Mozambique LNG project was suspended in 2021 due to security concerns following violent insurgent attacks in the Cabo Delgado province where the project is located. TotalEnergies declared force majeure (unforeseeable circumstances preventing contract fulfillment) after insurgents attacked the nearby town of Palma. The resumption now comes after improved security conditions in the region and increased support from international partners, including security assistance and financial backing from various countries to stabilize the area.

What is an EPC company and why are they important for this project?

EPC stands for Engineering, Procurement, and Construction. EPC companies are responsible for designing facilities (Engineering), purchasing all necessary materials and equipment (Procurement), and building the actual infrastructure (Construction). For the Mozambique LNG project, EPC contractors play a critical role in developing the complex facilities needed to extract, process, liquefy, store, and export natural gas. These specialized firms manage everything from the initial design to the final construction of processing plants, storage tanks, loading terminals, and supporting infrastructure—making them essential partners in bringing the $20 billion project to operational status.

What are FSRUs and FPSOs mentioned in some of the stock rationales?

FSRUs (Floating Storage and Regasification Units) are specialized ships that can store LNG and convert it back to gas form. They serve as offshore LNG terminals, allowing countries to import natural gas without building expensive onshore facilities. FPSOs (Floating Production, Storage, and Offloading units) are vessels used in offshore oil and gas production that can process hydrocarbons extracted from the seabed and store them until they're transferred to tankers for transport. In the Mozambique project, these floating facilities play key roles in the offshore infrastructure needed to process gas before it reaches the main onshore liquefaction plant, providing flexible and cost-effective solutions for gas production in deep-water environments.

How might investing in this theme differ from general energy investments?

Investing in the Mozambique LNG Revival theme is more targeted and event-driven compared to general energy investments. Rather than broad exposure to energy prices or the entire sector, this theme focuses specifically on companies positioned to benefit from the resumption of a single major project. It includes not just energy producers but also the companies that provide essential services, equipment, and infrastructure. This creates a more concentrated exposure to a specific development cycle with potential for contract announcements and project milestones affecting stock performance. The theme also has a geographic focus on companies with exposure to East African energy development, which may follow different timing and growth patterns than other energy regions worldwide.

15 handpicked stocks

Mozambique LNG Revival

This carefully selected group of stocks represents companies set to benefit from TotalEnergies' resumed $20 billion LNG project in Mozambique. Our professional analysts have identified key players across engineering, infrastructure, and shipping that are directly positioned to capitalize on this major energy development.

Han Tan | Market Analyst

Updated 2 days ago | Published at juillet 15