French supermajor Total SE has suspended work at its Mozambique liquefied natural gas (LNG) work site amid rising violence in the area.
Total said the security threat from violent insurgents had led it to declare force majeure on the $20 billion project. It did not say when work might resume.
“Considering the evolution of the security situation in the north of the Cabo Delgado province in Mozambique, Total confirms the withdrawal of all Mozambique LNG project personnel from the Afungi site,” Total said Monday.
The rise in violence from militants with ties to the Islamic State group has left more than 2,000 people dead and thousands of people displaced, according to Bloomberg. It marks another blow for Total, which shut down work at the site in January because of the increasing security threat. It attempted to restart construction activity in March, but a five-day attack last month on the nearby town of Palma, which left dozens dead, led Total to stop work once more.
“Total expresses its solidarity with the government and people of Mozambique and wishes that the actions carried out by the government of Mozambique and its regional and international partners will enable the restoration of security and stability in Cabo Delgado province in a sustained manner,” the company said Monday.
The African Energy Chamber said it was “disappointed” with Total’s decision and said the force majeure declaration was premature. It called for “all parties involved to have a better and more open conversation to find a practical and pragmatic common sense solution for the force majeure event to cease and for the project to resume, for the benefit not only of Total, but also of international and local companies, and especially for Mozambique’s people.”
Two other major LNG projects are being developed in Mozambique. Rovuma LNG is led by U.S. supermajor ExxonMobil, and the Coral South floating LNG (FLNG) project led by Italy’s Eni SpA. ExxonMobil also has a stake in Coral South.
ExxonMobil last year delayed taking a final investment decision on Rovuma as the global LNG market collapsed. A spokesperson told NGI on Monday the company was monitoring the situation in Mozambique.
Construction on the Coral South FLNG unit began in 2018 and startup is expected in 2022. An Eni spokesperson said that since Coral South is offshore, it is “an altogether different context” than Total’s project.
Sanctioned in 2019, Mozambique LNG includes developing the Golfinho and Atum fields offshore Mozambique and constructing a two-train liquefaction plant with a planned capacity of 12.9 million metric tons/year. Total acquired Anadarko Petroleum Corp.’s stake last year in a deal with Occidental Petroleum Corp.
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