Page 9 - GLNG Week 33

GLNG COMMENTARY GLNG

Security risks on the

rise in Mozambique

Militants seize control of Mocimboa da Praia, the
main port of entry for Mozambique LNG supplies

POLICY MOZAMBIQUE’S plans for developing off- Conflict considerations
shore natural gas resources recently took a step All of the LNG consortia mentioned above are
WHAT: forward, with the signing of a $14.9bn loan deal working in northern Mozambique, not far from
Unrest in northern between multiple banks and the Mozambique the border with Tanzania. The area has been res-
Mozambique has the LNG consortium. The credit will cover most of tive for some time, owing to disputes between
potential to affect the the $20bn that the group expects to spend on the region and the national government. About
Mozambique LNG project. upstream activity at the offshore Area 1 and on three years ago, though, the unrest began
the construction of a gas liquefaction plant and expanding to include attacks by Islamist groups,
WHY: associated infrastructure. including Ahlu Sunnah Wa-Jamo (ASWJ),
Total and other investors As such, it will put Mozambique LNG, led which has links to the Islamic State (Daesh).
in LNG projects are likely by France’s Total, on the road to beginning gas To date, more than 1,000 people have been
to press forward, but extraction and LNG production on schedule killed by the insurgents. The country’s armed
they may have to make in 2024. By extension, it will also help convince forces, known as FDS, have been trying to con-
new transportation and other investors and lenders that Mozambican tain the violence and push back against militants
security arrangements. LNG projects – not just ongoing projects such seeking to establish an Islamic caliphate. They
as Coral South LNG and Rovuma LNG, both of have had limited success, not least because they
WHAT NEXT: which will rely on gas from the offshore Area 4, lack the ammunition and other supplies needed
If the conflict drags on but also future initiatives – are worth supporting. to respond effectively. (They have also reported
or escalates, the target Likewise, if additional gas projects go forward, that the rebels are using residents of the region as
dates for LNG production they will drum up demand for services that local human shields.)
may have to be pushed companies can provide, such as transportation, On August 12, FDS suffered a major setback.
back. construction and hospitality. This, in turn, would ASWJ forces succeeded in gaining control of
allow the Mozambican private sector to grow Mocimboa da Praia, a port that has been serving
and flourish, even as gas revenues began filling as the main entry point for shipments of equip-
the government’s coffers. ment and goods for Mozambique LNG. The
But there are obstacles on the path to success – port is about 75 km from the site on the Afungi
and one of them has grown more urgent during peninsula where the consortium is building the
the last week. onshore plant that will process gas from Area 1.

Week 33 21•August•2020 www. NEWSBASE .com P9