Africa-Press – Mozambique. TotalEnergies emphasised the security assurances provided by the President of Mozambique in a letter informing President Daniel Chapo of the decision to lift the force majeure on the Liquefied Natural Gas (LNG) megaproject in Cabo Delgado.
In the letter, signed by TotalEnergies chairman Patrick Pouyanné, addressed to the Mozambican President, in which the Concessionaire lifts the project’s force majeure, it is recalled that “to carry out its obligations under the Exploration and Production Concession Contract (EPCC)”, it needs to be able to “safely access and use the land and maritime areas required for the execution of the project”
It states that the partners in Area 1 of the Rovuma Basin “have taken note with high interest” of the position taken by the head of state on 2 October in Maputo and the security assurances he “provided” in the address. In particular, the signing last August of the Status of Forces Agreement (SOFA) between Mozambique and Rwanda, an international instrument “that confirms the continued presence of Rwandan forces in Cabo Delgado, at least during the construction period” of the LNG megaprojects, while also supporting the training of Mozambican military personnel.
“The ultimate goal is to equip our forces to guarantee security independently. Therefore, we affirm that the conditions have been met for the raising of the Force Majeure and we await the declaration of the concessionaires of Area 1, the Mozambique LNG Project, on this matter shortly,” said Chapo, quoted in the letter of 24 October, signed by the president of TotalEnergies and consulted by Lusa.
“Considering these assurances and the security organisation established by the project based on a containment mode, the Mozambique LNG Concessionaire assesses that the required safety conditions are now in place to allow it to resume its activities and the Concessionaire has taken the decision to lift the Force Majeure,” it reads.
TotalEnergies has also proposed that the government extend the concession for the gas megaproject by 10 years, to “compensate” for losses of $4.5 billion (€3.870 billion) for four years of suspension. The request is justified in order to “partially offset the economic impact” of the stoppage due to the terrorist attacks.
“The concessionaire respectfully requests that the Government grant an extension to the Development and Production Period of the Golfinho-Atum [field] (…) for a duration of 10 years,” it reads.
It adds that “as a final step before the full launch of the project”, the Mozambique LNG Concessionaire, led by TotalEnergies, “is awaiting approval from the Government of Mozambique for the revised cost and schedule”, submitted to the Ministry of Energy.
‘The approval of this revised budget will cover the incremental costs incurred by the project due to “force majeure” events, which total $4.5 billion,’ it said.
“In addition, the prolonged period of suspension due to “force majeure” has significantly impacted the project’s schedule,” the letter states, indicating that the first delivery of LNG from the first line to be installed in Afungi has been moved from July 2024, as planned, to the “first half of 2029”.
At stake is a megaproject worth $20 billion (€17 billion), led by the French oil company, whose progress has been hampered over the last four years by terrorist attacks in the northern province of Mozambique.
In 2021, following violent terrorist attacks in the area, TotalEnergies triggered the “force majeure” clause and suspended activities due to the terrorist attacks in Cabo Delgado, while the construction of a natural gas production and export plant in Afungi Bay was underway.
Mozambique has three LNG megaprojects off the coast of Cabo Delgado.
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