The government has identified a difference of around $2 billion in costs submitted by TotalEnergies relating to the suspension period of the Mozambique LNG project, in Area 1 of the Rovuma Basin in Cabo Delgado, as part of an independent audit currently in its final stage, according to Lusa.
According to sources close to the process, the French oil company submitted expenses exceeding $5 billion, linked to the impact of the interruption of activities after the force majeure declaration in April 2021, following armed attacks in Palma.
However, preliminary results from the government-commissioned audit indicate that only about $3 billion have documentary support deemed compliant with the criteria for cost recovery. This results in a discrepancy of nearly $2 billion compared with the amount initially claimed.
The review comes at a critical moment for the project, as TotalEnergies awaits assessment of the development plan submitted by Mozambique LNG for the full resumption of operations. When asked about the process, the government confirmed the audit but declined to comment on its findings.
“The Government of Mozambique confirms that it commissioned an audit, as is public knowledge. It is now in its final stage, and we regret that we cannot at this stage comment on the substance of the work being carried out. We will do so in due course,” a government source said. “The company maintains its target of starting production and LNG deliveries from the first line at Afungi in the first half of 2029.”
The audit was assigned to UK-based consultancy Bayphase and focuses on cost recovery mechanisms for liquefied natural gas (LNG) projects in the Rovuma Basin. The objective is to verify whether costs associated with operations align with market values and to validate expenses deemed recoverable under concession contracts.
The process gained importance after the official relaunch of the Mozambique LNG project, announced in January by President Daniel Chapo and TotalEnergies CEO Patrick Pouyanné, nearly five years after the suspension of activities. At the time, Pouyanné declared the end of the force majeure period and reaffirmed that the project represents the company’s largest investment in Africa. President Chapo stressed that the cost validation process should not delay operational progress.
A Council of Ministers resolution made an independent audit of costs incurred during the force majeure period mandatory and established that its results require government validation, following principles of transparency and impartiality. The same framework maintained a 30-year development and production period for Area 1, excluding the suspension period.
Although TotalEnergies had proposed an extension of more than ten years to compensate for costs and losses allegedly accumulated since 2021, the government has reiterated that the suspension decision—on a $20 billion project—was taken unilaterally by the concessionaire. The company still aims to begin production and LNG deliveries from the first Afungi line in the first half of 2029.
Source: Diário Económico
