Page 15 - DMEA Week 14 2021

DMEA TERMINALS & SHIPPING DMEA

Mozambique LNG’s fate in doubt

AFRICA UNCERTAINTY about the fate of the Mozam- saying in a Radio Mozambique report last week
bique LNG project have become more urgent that the construction site was still “protected.”
over the last week. Vidigal also downplayed reports of chaos and
France’s Total, the leader of the consortium, destruction in Palma and nearby areas, saying
appears to have abandoned its hope of restarting that Maputo had never been in doubt about its
work at the site on the Afungi Peninsula where ability to ensure the region’s security. “At no time
it is building a natural gas liquefaction complex. was its integrity at stake,” he declared.
Instead, it has withdrawn the remaining mem-
bers of its workforce from northern Mozam- No clear outcome
bique in the wake of an Islamist group’s attack on Even so, it appears that the situation is still very
the nearby town of Palma on March 24. much in flux.
It announced its decision in a statement dated Total has reportedly left its construction site
March 27, saying: “The remobilisation of the entirely in the hands of FDS troops and is now
project that was envisaged at the beginning of concentrating on completing the evacuation of
the week is obviously now suspended. Total has its workforce. It is providing some support to
decided to reduce to a strict minimum level the the thousands of refugees who have tried to take
workforce [at] the Afungi site.” shelter in or near its facilities, in the form of food,
According to press reports, all of Total’s emergency transportation and evacuation ser-
employees had departed from the site by April vices, but it is also remaining mum about when,
2. As of press time, the company had not yet said whether or how it might resume work.
when work might resume. According to Joseph Hanlon, a senior lecturer
The French major has been working with at the Open University and a recognised expert
Mozambique’s government for several months to on Mozambique, the French major is not likely
secure protection for operations, and its efforts to resume operations any time soon. Officials
have borne some fruit. Last month, for exam- in Maputo will need time to follow up on offers
ple, the two sides reached an agreement on the of assistance and military training from foreign
establishment of a secure zone encompassing the partners such as the US and Portugal, he noted.
construction site on the Afungi Peninsula and “Will Total return? Not in the short term.
surrounding areas, including Palma. (The zone It will take perhaps two years for US, Portu-
also covered Quitunda, the village where Total guese and other trainers to create a functioning
arranged to resettle people displaced by its con- army,” Hanlon wrote in an opinion piece for
struction project.) his Mozambique News Reports and clippings
newsletter,
Maputo’s commitments He also speculated that the company might
Unfortunately, though, Maputo appears to be very well decide to drop the Mozambique LNG
having difficulty upholding its commitments project if local authorities could not guarantee
under the agreement. safety, security and improved conditions in the
The document called for Mozambique’s spe- areas where it has been working.
cial forces, known as the Defence and Security “Total has other interests in Africa; it has
Forces (FDS), to be responsible for setting up only spent a small part of the $20 bn project
and maintaining the secure zone. However, FDS cost and can still walk away. Even if it returns, it
troops were not able to prevent Ahlu Sunnah will demand a much more favourable deal with
Wa-Jamo (ASWJ), the Islamist group that has Mozambique,” he wrote.
been working since 2017 to seize control of the
northern Cabo Delgado province, from attack- High stakes and big money
ing Palma on March 24. The government of Mozambique has an incen-
Nor were they able to clear the area of ASWJ tive to try to meet such demands.
fighters quickly. Instead, Palma was not declared After all, Total is just one of three major
safe until several days later, after the arrival of international oil companies (IOCs) looking
troops from the country’s regular armed forces, to develop the country’s offshore gas reserves.
known as Forças Armadas de Defesa de Moçam- Maputo is eager to see Italy’s Eni and US-based
bique (FADM). ExxonMobil proceed with their own Coral
Meanwhile, some observers have complained South LNG and Rovuma LNG projects. If all
that Maputo reacted too slowly to the emerging three projects move forward, they will bring at
crisis. Upstream quoted Lionel Dyck, the head least $50bn worth of direct investments into the
of Dyck Advisory Group (DAG), a private country, while also creating new streams of jobs
South African security contractor, as saying that and budget revenue.
FADM had been slow to provide support to his Even so, the ability of FADM and FDS to
men and to local police forces. deliver safety and security is far from assured. As
For its part, FADM has presented a more such, the Mozambican government will have to
confident face to the public. Chongo Vidigal, a work hard to overcome perceptions that it is not
spokesman for the armed forces, was quoted as prepared to restore order in Cabo Delgado. ™

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