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Area 1: PR Thanks Donald Trump for Nearly $5B in Funding for Mozambique LNG Project

Area 1: PR Thanks Donald Trump for Nearly $5B in Funding for Mozambique LNG Project

The Mozambican President thanked his US counterpart, Donald Trump, for approving funding of 4.7 billion dollars for the Mozambique LNG project, which is expected to create 20,000 jobs in the United States of America (USA), Lusa reported on Thursday, 20 March.

‘Your support plays a crucial role in advancing this crucial project. Mozambique LNG has the potential to generate 13 million tonnes of liquefied natural gas per year, create 40,000 new jobs, including approximately 20,000 in the US,’ reads the message sent by Daniel Chapo to Donald Trump and released today by the Mozambican Presidency.

‘This support allows American companies to participate in Mozambique and contributes to global energy security, within the framework of a solid partnership between our two countries,’ adds the letter, referring to the approval of the financing for the liquefied natural gas (LNG) project by the Export-Import Bank of the United States of America (Exim Bank).

Chapo emphasised that the project, valued at 15 billion dollars, also represents ‘a commitment to protecting the natural resources of southern and eastern Africa. By promoting responsible development, we are ensuring that it benefits both the local population and our global partners’.

Oil company TotalEnergies said this week that the financing for the restart of the natural gas exploration megaproject in Cabo Delgado, in the north of the country, is practically closed, following the approval of Exim.

‘We’re still in a situation of force majeure, the project hasn’t restarted yet, but one of the critical steps was the decision of the Exim Bank, which reaffirmed its support for the global financing of Mozambique LNG. It’s a very important investment, it’s a critical step,‘ said TotalEnergies’ director for Mozambique, Maxime Rabilloud.

He was reacting to the reconfirmation, on 13 March, by the board of the Export-Import Bank of the United States of America (Exim Bank) of the financing of 4.7 billion dollars for the project in Mozambique.

TotalEnergies, leader of the Area 1 consortium, is developing the construction of a plant in Afungi, near Palma, in the northern province of Cabo Delgado, for the production and export of natural gas.

TotalEnergies’ LNG project, one of three under development in Mozambique, has been suspended since 2021 due to the terrorist attacks in Cabo Delgado, which led the oil company to invoke the force majeure clause and withdraw all staff from the construction site. This forced the consortium of financing banks to reconfirm the previously approved financing, and the resumption of activities is also conditional on the re-establishment of security, which has the support of the Rwandan armed forces in the area.

Maxime recalled that ‘the overall financing for the project, with various international banks and credit agencies, is 15 billion dollars’. In addition to the US Exim Bank, he emphasised, ‘the Asian banks of the financing consortium had also reconfirmed financing of around five billion dollars, and only the European banks have yet to confirm it’.

Since October 2017, the gas-rich province of Cabo Delgado has been facing an armed rebellion, which has caused thousands of deaths and a humanitarian crisis, with more than a million people displaced.

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