Energy group ExxonMobil Mozambique Limitada has awarded a Letter of Intent to the SMDC joint venture for the midstream portion of the Rovuma LNG Phase 1 project in northern Mozambique.

The agreement covers limited engineering, long-lead procurement and constructability reviews. Work will be carried out by the SMDC alliance, which brings together US firm McDermott Energy Solutions, Italy’s Saipem, South Korea’s Daewoo Engineering & Construction and China Petroleum Engineering & Construction Corporation.

Operating on behalf of Area 4 partners, project developer Mozambique Rovuma Venture SpA is targeting a Final Investment Decision by the end of 2026. The project entity is held by ExxonMobil, ENI and CNPC, alongside Mozambique state firm ENH, Korea Gas Corporation and Abu Dhabi’s XRG.

The onshore midstream development features 12 modular liquefaction trains with a total annual capacity of 18.6 million tonnes of LNG. Designed as an eco-friendly e-driven facility, electric motors will power the liquefaction process in place of gas turbines, supported by an on-site gas combined cycle power plant to lower carbon emissions. Initial commissioning and commercial operations are scheduled for 2031.

Engineering for inside battery limits, including the liquefaction modules, will be executed by McDermott from its London and Gurgaon offices, with project management seconded to the joint venture team based in Milan.

“Our work on Rovuma LNG builds on McDermott’s established LNG expertise in Mozambique and our disciplined approach to execution,” said Michael McKelvy, Chief Executive Officer and Chair of the Board for McDermott. “Our experience on Mozambique LNG, combined with our long-term commitment to the country, positions us to deliver critical infrastructure that supports Mozambique’s emergence as a major global LNG supplier.”

“This award reflects the strength of our long-standing relationship with ExxonMobil and our ability to deliver complex LNG developments,” added Rob Shaul, McDermott’s Senior Vice President of Low Carbon Solutions. “Having successfully executed front-end engineering design (FEED) for Rovuma LNG, we are well positioned to advance the project into its next phase.”

A Daewoo E&C official explained the significance of the award, stating, “The receipt of this Letter of Intent (LOI) is the result of being recognised for our ability to lead projects while standing shoulder-to-shoulder with global powerhouses in the EPC industry, completely breaking free from the limitations of domestic construction companies that were previously confined to the subcontracting level.”

“We will provide full support from the initial design and procurement stages to ensure that the client’s Final Investment Decision (FID), scheduled for the end of this year, proceeds without any setbacks,” a Daewoo E&C official said. “As we will secure a large-scale overseas order upon the conversion to the main EPC contract, we will solidify the company’s mid-to-long-term growth engine based on thorough risk management and technological capabilities.”

According to a study by Standard Bank, the Rovuma LNG development could contribute around US$11 billion annually to Mozambique’s Gross Domestic Product, generate US$150 billion in state revenues over its 30-year operational lifespan and create more than 150,000 jobs.