Grindrod paving the way to support the LNG industry in Mozambique

Grindrod paving the way to support the LNG industry in Mozambique

May 18, 2020

Mozambique is set to become one of the world's biggest LNG exporters, with over 30 million mt/year of production capacity in development.

Palma, in the Cabo Delgado province in northern Mozambique, will be the base for the liquefied natural gas ("LNG") operations being developed onshore by the two consortia i.e., Mozambique LNG (lead by Total) and Rovuma LNG (lead by ExxonMobil).

The Palma town and surrounding areas will grow exponentially as people, equipment, project cargo, food, and related goods are brought into the region for the construction of this infrastructure. The LNG process plants (LNG trains) alone will consume approximately 2.5 million project cargo tons over the first 48 months of development - a significant requirement for logistics services to move, store and manage containerised and break-bulk cargo to this area from the Ports in Mocimboa de Praia, Pemba, Nacala, Beira, Maputo, and Durban. 

The Grindrod team in Northern Mozambique has been paving the way to take advantage of this significant opportunity. An excellent example of unlocking a trade corridor by investing in infrastructure and working with customers to find the most efficient and cost-effective supply chain solutions. 

During the first quarter of 2020, Grindrod celebrated the first chartered vessel delivering cargo from Pemba to the Cabo Afungi off-loading facility (aka Early Emergency Beach Landing or EEBL) in the Cabo Delgado Province, about 20km from Palma. This shipment is destined for Mozambique LNG's contractors, who are in the process of establishing the requisite infrastructure to support the construction of the LNG trains.

 Despite many obstacles such as insurgency attacks, the demise of road infrastructure, COVID-19 lockdowns, and changing compliance rules, the Grindrod team succeeded in establishing a dedicated, first of its kind, delivery service to Cabo Afungi ex the main hub ports of Mocimboa da Praia, Pemba, and Nacala.

To facilitate the logistics involved, Grindrod has established operations in Pemba and Cabo Afungi, where trucks and the chartered vessels are loaded/off-loaded for deliveries to and from the Cabo Delgado Province. Further to this, Grindrod acquired the rights to a strategically located plot of land near Palma and is currently developing a facility which will support a combination of the following services: 

  • Transportation of containerised and break-bulk cargos.
  • Transportation of temperature-sensitive/refrigerated containers.
  • Handling and storage of:
    • General cargo under roof and in an open yard
    • Full and empty general purpose and refrigerated containers
  • Container services:
  • Repair and calibration facilities
  • Empty container management
  • Distribution of import cargo.
  • Fuel storage and distribution.
  • Staff accommodation to support Port / Stevedoring operations; and
  • Parking facilities for trucks.

There are many intricate 'pieces' to unlocking and integrating activities along this corridor – from negotiating with the government, working with multiple multinational LNG companies, acquiring strategic land, dealing with compliance issues, planning and chartering vessels, operating fleets of trucks, managing the construction of a new facility, etc. Many Grindrod people have been involved in this process. To name a few:

Francois Van Rensburg, Head of Business Development, also heads up the Northern Mozambique team and project.

Danie Parsons, Divisional Chief Executive Grindrod Logistics Africa. Danie and his team have had extensive experience in over border logistics in Africa.

Frans Visser, Executive Operations for Grindrod Logistics Mozambique. Frans has headed up the Nacala operation and has driven the diversification of cargo delivery to other regions. 

Ozi Honwana, General Manager Grindrod Logistics Mozambique, has been hands-on in ensuring that the logistics operations run smoothly.

Rob Gardner, Executive - Business Development for SGM has extensive experience and an extensive network in the LNG and maritime industry. This network has been invaluable.

Well done, team.