It remains anyone’s guess as to when a $20-billion liquefied natural gas (LNG) project in Mozambique will take off again, after French energy group Total declared force majeure in April 2021 following Islamic State (IS)-linked insurgent attacks.Logistics operators in the country are keeping a close eye on the project as it holds major potential for work.“There is a lot of focus on the project and everyone is watching to see how it is resolved,” an operator told Freight News. “Everyone wants to be involved in the project, but it is still on hold. No one knows what is happening or when it will get back on track.”These sentiments were echoed at the annual Africa Oil Week conference, held in Cape Town at the beginning of October, with the Mozambican delegation asking repeatedly where the project stood. No conclusive answers were given and everyone Freight News spoke to said it was a matter of wait and see. Early predictions are that if anything should happen on the project, it won’t be before the first quarter of 2023.Total had aimed to produce its first cargo from the project in 2024, but the group withdrew all of its staff in 2021 when dozens of people were killed in attacks in the coastal town of Palma – the closest town to the project.Given its large, low-cost resource base, Mozambique is desperate to see Total return to the project and take up construction again. This project alone would enable the country to be one of the key supply centres of LNG in the world. The LNG project includes development of the Golfinho and Atum natural gas fields in the Offshore Area 1 concession, and the construction of a two-train liquefaction plant with capacity of 13.12 million tonnes per annum (mt pa). “There is a lot of interest in southern Africa’s gas fields,” said a logistics service provider who preferred to remain anonymous. “If one considers the amount of gas that Mozambique has and the global demand for gas – particularly now, given the interruption of supplies in Europe – the importance of this project is clear. “Fossil fuels are not going to be abolished, but moving away from coal is going to result in an increase in the use of gas.”Another logistician said everyone was interested in gas projects like this as they were lucrative and offered stable work over several years. “Also, there is a lot of investment in the projects in the country overall. Given what is happening in South Africa and its struggles over power and politics, Mozambique continues to attract attention as a place to invest.”He added that the East African nation’s economy was thriving, the currency was stable, it had sufficient power and the infrastructure was not too bad. “A lot of what is happening in Mozambique pivots on the developments in the north,” said another source. “If the big LNG project goes ahead, it will be a driver of growth and foreign investment. If it does not get off the ground again, then someone had better come up with another plan. “As it is, we have been banking on the LNG project for a long time and no one seems to have any idea of an alternative if this fails.”Clearly, ensuring that the region is safe and ridding it of IS insurgents will be imperative for the project to stand any chance of success.
