RBR Group signs labour hire deal to take on Mozambique’s LNG boom
Mozambique’s booming LNG industry is expected to require up to 50,000 workers on site at peak construction.
Labour hire and training specialist RBR Group (ASX: RBR) has inked a binding memorandum of understanding with global manpower services supplier Kuiper International to capitalise on the impending liquified natural gas (LNG) construction boom in Mozambique.
Under the proposed alliance, RBR will combine its own database of local workers with Kuiper’s global database of skilled expatriate tradespeople to take advantage of the east African country’s projected US$50 billion industry.
The merged pool of workers will be offered to clients using RBR’s Mozambican labour hire licence, which is a pre-requisite to providing such manpower services.
According to RBR, the LNG industry is expected to require up to 50,000 workers on site at peak construction.
The company already has a database of around 110,000 local Mozambican workers, which it pooled back in July in preparation for the approaching boom.
While a high percentage of locals are expected to be employed in order to meet local content rules set by the government, RBR said significant numbers of expatriates will still be required.
Kuiper is regarded as one of Asia Pacific’s fastest growing workforce suppliers to the oil and gas, construction, marine and petrochemical industries. It has participated in high profile projects including the LNG jetty and marine works package for Chevron’s Gorgon project and Barrow Island LNG plant off Western Australia.
Hence, a partnership with a skilled expatriate provider such as Kuiper is expected to boost RBR’s ability to capitalise on the growing demands for labour hire in the country.
“RBR believes it is ideally positioned to secure substantial training and labour hire contracts associated with three LNG projects underway or planned for Mozambique,” the company stated.
With construction of onshore projects expected to start in the first half of 2019, RBR is anticipating the issue of major contracts “in coming months”.
Mozambique’s imminent LNG boom
According to company statements and news reports, two proposed giant onshore LNG projects in Mozambique are expected to require a combined capital investment of about US$50 billion.
One is the 12 million-tonnes-per-annum Golfinho/Atum LNG development led by Anadarko Petroleum (NYSE: APC), where early works capital projects have already been approved to allow construction to start as soon as the final investment decision is made (anticipated in 2019).
The second a 15.2Mtpa project led by ExxonMobil which involves the construction of two of the world’s biggest liquefaction units outside Qatar. The final investment decision for this project is also expected next year, with production targeted to commence in 2024.
In addition, Eni has already confirmed its final investment decision to develop a 3.4Mtpa floating LNG project in Area 4 of the offshore Rovuma Basin.
According to RBR’s June 2018 quarterly report, there is an expectation that the Mozambican government will mandate a local content quota of between 10% and 25% of the total capital spend. The country produces very little in terms of industrial goods, with the bulk of local content expenditure likely to comprise of labour-related expenses and logistics.
RBR’s stock jumped 37.5% to $0.011 on the news this morning. By afternoon trade, the share price was up 12.5% at $0.009.