ExxonMobil is seeking security assurances from the Government of Mozambique before moving ahead with its proposed $30 Billion Liquefied Natural Gas (LNG) terminal in the country’s northern region.
The company’s Chief Executive Officer, Darren Woods, held a meeting last week with Mozambique’s President, Daniel Chapo, to discuss the safety concerns surrounding the project site in the Cabo Delgado Province.
This development comes as ExxonMobil prepares to make a final investment decision on what is expected to become Africa’s largest LNG facility.
The project has faced delays for several years following violent insurgent attacks in the resource rich northern region.
A report by the Financial Times stated that Woods sought reassurance from President Chapo over the stability of the area and the protection of workers and infrastructure.
The discussion also covered plans by French energy company, TotalEnergies, to restart operations on its nearby LNG project which was halted due to insecurity.
According to the report, both leaders spoke about the importance of restoring investor confidence and ensuring long term stability for Mozambique’s energy sector.
Rising insecurity threatens energy ambitions
Mozambique’s northern region, Cabo Delgado, has been the centre of an Islamic State linked insurgency since 2017. Armed militants have attacked several towns, destroyed homes, and displaced hundreds of thousands of residents.
The insurgency has also disrupted multi billion dollar energy investments, including projects by ExxonMobil and TotalEnergies.
The violence forced TotalEnergies to declare force majeure and suspend work in 2021 after insurgents invaded Palma, a key logistics hub near the LNG site.
Efforts by regional troops and government forces have since contained parts of the unrest, but sporadic attacks continue to threaten development plans.
The LNG projects are viewed as central to Mozambique’s economic recovery, capable of generating billions of Dollars in exports and creating thousands of jobs.
President Chapo, in a statement to the Financial Times, noted the significance of ExxonMobil’s investment, saying the project would bring wide-reaching benefits to citizens.
“We strongly believe that the ExxonMobil project, if implemented, will make a huge difference in the economy of Mozambique and, as a consequence, in the life of Mozambicans,” Chapo stated.
Global energy interest and next steps
ExxonMobil’s LNG plan is among the largest in sub Saharan Africa, estimated at $30 Billion.
The company is developing the project alongside partners including TotalEnergies and the Mozambique Government.
An Exxon spokesperson mentioned that the firm is working closely with all stakeholders to ensure that the right conditions are met before approving the final investment decision. T
he company has yet to announce when construction will begin.
Meanwhile, TotalEnergies is expected to resume operations soon after suspending activities for over three years.
The return of the French company could strengthen Mozambique’s position as one of Africa’s emerging gas producers.
