Negotiations continue: the oil company requested a ten-year extension of the concession to resume the megaproject; Mozambique responded with four and a half years and is calling for an independent audit of the alleged losses.
The Mozambican government has agreed to reinstate a four-and-a-half-year stoppage period for the Area 1 liquefied natural gas (LNG) megaproject in Cabo Delgado, instead of the ten years proposed by TotalEnergies as a concession extension, which the company justified by losses resulting from the suspension. This is the response to the letter sent to the government in October, in which the French oil major set out the conditions for resuming the Afungi project.
A source close to the process told Lusa that the resolution approved by the Council of Ministers in November establishes “reinstatement in accordance with current regulations,” covering the period during which the project was suspended due to force majeure—namely following terrorist attacks, from April 2021 to October 2025.
The resolution also defines the “need to assess all expenses” incurred by the French oil company as a result of the situation. TotalEnergies points to an amount of USD 4.5 billion. This assessment requires “technical rigor and transparency, ensuring the protection of the public interest and contractual predictability, through an independent audit, which includes the right of reply, before approval of the final report.” The government also decided to provide the necessary institutional support to allow for the orderly and efficient resumption of construction activities at the LNG processing plant on the Afungi peninsula.
“We Are Working” Toward Resumption
President Daniel Chapo said in mid-November that negotiations with TotalEnergies were nearing completion. “We are working to close the points we consider important for the benefit of both the Mozambican people and those who are investing,” he added.
“The Government (still) has to take a position on the development plan, assess the impact of the stoppage and consider all constraints before any decision.”
At stake is a USD 20 billion megaproject. The concessionaire now indicates that the first LNG delivery from the industrial complex to be installed in Afungi has been postponed to the “first half of 2029.” It had previously been scheduled for mid-2024.
On another front, the Mozambican government said it needs “very concrete data” to take a position on the criminal complaint against TotalEnergies, accused of “complicity in war crimes” in the Cabo Delgado gas megaproject, and promised to follow the case. The complaint was filed by the European Center for Constitutional and Human Rights (ECCHR) with the French National Anti-Terrorism Prosecutor’s Office (PNAT). The ECCHR accused the multinational of “having directly financed and materially supported a joint team composed of Mozambican armed forces, which between July and September 2021 allegedly detained, tortured and killed dozens of civilians at TotalEnergies’ gas facilities.” “Given the seriousness, if this is the case, the country and the government will naturally take a position,” said the spokesperson for the Council of Ministers, Inocêncio Impissa.
A Context of Major Gas Reserves
Mozambique has three approved development megaprojects for exploiting gas reserves in the Rovuma Basin, classified among the largest in the world, off the coast of Cabo Delgado. Two of them, onshore, are planned for the Afungi peninsula, side by side: one megaproject by the Area 1 consortium, led by TotalEnergies (expected production of 13 million tonnes per year, mtpa), and another by the Area 4 consortium, led by ExxonMobil (18 mtpa), budgeted at USD 30 billion and awaiting a final investment decision.
There is also another Area 4 investment led by Italy’s Eni, which has been producing around 7 mtpa since 2022 from the Coral South floating platform, offshore in the Indian Ocean, about 40 kilometers off the coast of Cabo Delgado. This capacity will be doubled from 2028 with a second platform (Coral North), in an investment of USD 7.2 billion (€6.2 billion).
