The market always has an answer to the question of where Europe will get natural gas to stay warm this winter. Businesses in the English and Norwegian parts of the North Sea have sped up their work (and some results have already come in). But Mozambique, where Exxon Mobil ( NYSE:XOM ) is part of a group that just loaded the first LNG tanker to rebalance natural gas supply significantly, has one of the most important answers. Africa Oil ( OTCPK:AOIFF ) and Africa Energy are two other companies I follow that have told me about discoveries ( OTCPK:HPMCF ). But these companies backed by the Lundin Group will have to wait a few years before shipments start. On the other hand, Mozambique has made a significant discovery that is getting ready to meet a big demand in Europe.
Exxon Mobil is a part of the discovery off the coast. But now that significant natural gas finds have been made public; this African country may have many more chances in the future. Mozambique has gone from almost not producing anything to being a big exporter. Exxon Mobil’s project alone cost $8 billion, and other projects are in the works to increase the country’s oil production in the future.
Exxon Mobil says that it is just far enough ahead of a few big projects that cash flow from this project and a few others will start. This is similar to the coverage in Guyana, where money is starting to come in from another big project.
Exxon Mobil also said that it had found a large amount of oil in Angola for the first time in about 20 years. These African countries are in a great position to help solve the shortage problems in Europe. It’s likely to be a little “messy” now, since market solutions aren’t always “synchronised” perfectly. But there is a solution for Europe that does not involve Russia, which is closer than many believe.
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