Brutal extremist attack puts Mozambique's LNG projects at risk

Mozambique's great hope of economic recovery now lies in tatters after a brutal two-day attack by insurgents threatens the future of multibillion dollar liquified natural gas (LNG) projects in the north of the country, and left dozens dead.

29 Mar 2021

Total's Afungi project. Photo: Club of Mozambique

The group known as al-Shabaab, believed to have Islamic State ties, attacked the town of Palma in the northern province of Cabo Delgado on 24 March, just hours after Total announced it would be resuming infrastructure construction on its Afungi field after the Mozambique government established a 25km security zone around the project. The French energy company bought a 26.5% stake in the development for $3.9bn in 2019, but stopped operations in December 2020 after regular skirmishes by al-Shabaab in the nearby countryside grew closer to its facilities.

Palma is located 8km from the Total camp and is the base for many of the companies involved in the LNG projects.

One South African, Adrian Nel, has been confirmed dead, after he was shot while trying to escape in a convoy that was ambushed on 26 March.

In a statement on 27 March, Total said it has decided to reduce to a strict minimum level the workforce on the Afungi site. “The remobilisation of the project that was envisaged at the beginning of the week is obviously now suspended. Total trusts the government of Mozambique whose public security forces are currently working to take back the control of the area.

Is the project too big to fail at this point? I’m just wondering when and if Total is ever going to cancel the project or if it will continue to sink more money into it. It seems like the insurgency is getting worse instead of better. #LNG
— Global LNG News (@GlobalLNGnews) March 28, 2021