FT: Gas investments of $50bn into Mozambique hit brick wall. Again.

Key topics:ExxonMobil delays public event amid $30bn Mozambique gas project talksIslamist insurgency intensifies in Cabo Delgado, threatening LNG projectsTotalEnergies resumes $20bn project despite violence and security concerns.Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here.Support South Africa’s bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here..By Martha Muir in Houston, Jamie Smyth in New York, Ian Johnston in Paris and Monica Mark in Johannesburg.ExxonMobil executives cancelled a public appearance with Mozambique’s president on Wednesday to announce a renewed push for a $30bn gas terminal in the African nation, as an Islamist insurgency threatens security.The US oil major signed memorandums of understanding with the Mozambican government earlier in the day to establish a training centre and advance local energy projects following a private meeting between senior company executives and President Daniel Chapo at Exxon’s Houston headquarters, according to people familiar with the matter.But a joint media briefing with the president and Exxon executives was cancelled.The project — and a rival project led by TotalEnergies — are facing growing calls to be delayed from aid and campaign groups who have visited the project in the Cabo Delgado province recently. They have warned that the insurgency is intensifying and the restart of major investments by western oil companies could inflame the situation.“The security situation has got much worse,” said Oxfam’s Andrew Bogrand, a senior policy adviser at Oxfam who talked to community leaders, police and local people in the region this month.“People are talking about attacks happening on a nightly basis on highways around the project. I just don’t understand how you can have a genuine conversation on whether or not this project moves forward in this context.”.Read more:.FT: US swings behind TotalEnergies’ vast Mozambique gas project.Exxon and a spokesman for the Mozambican government declined to comment.The meeting at Exxon’s campus in Houston followed a decision by TotalEnergies on Saturday to proceed with its rival $20bn LNG project in the same region of Mozambique, which was put on hold in 2021 following a deadly attack by militants. The French oil group judged it was safe to proceed and lift a contractual get-out clause, known as force majeure, a milestone required before Exxon can make a decision to proceed with its project, Rovuma LNG.On Wednesday, conflict monitoring organisation Acled said it had observed a “surge in insurgent activity” across the Cabo Delgado province in recent weeks, with reports of 22 people dying from violence from October 13 to 26.Among the recent reported attacks include the beheading of a security guard employed by ISCO, the Rwandan company charged with guarding Total’s gas project on the Afungi peninsula. The guard was killed at his home near the town of Palma, in the north of the province, Acled said.“The focus on the north is potentially linked to the increasing importance of Palma ahead of the restart of the LNG project, although a small group is unlikely to be able to threaten the site,” Acled said.This month the UN Refugee Agency reported that an upsurge in violence last month marked a turning point in northern Mozambique, with more than 100,000 people forced to flee their homes this year.In a letter to Chapo seen by the Financial Times, TotalEnergies chief executive Patrick Pouyanné said that “required security conditions are now in place to allow [the consortium] to resume its activities”, citing a recent agreement between Maputo and Kigali for Rwandan forces to remain in Cabo Delgado during the construction of Mozambique LNG and Rovuma LNG, the Exxon-led project.Friends of the Earth, which has campaigned against the TotalEnergies project, said the move by the oil company was “disastrous”.“Violence has been increasing so it’s baffling that Total would choose now to lift the force majeure,” said a spokeswoman.Chapo, who was sworn in as president in January, has pledged to restart three stalled gas projects and kick-start development in the country’s impoverished northern region.Exxon is expected to announce a final investment decision early next year on its $30bn gas terminal, which would be the largest in Africa.Delays caused by the insurgency risk raising the cost of Exxon and TotalEnergies’ projects, which the companies and the Mozambique government say could provide an economic boost to one of the world’s poorest nations.When TotalEnergies said it planned to lift force majeure, it asked the Mozambican government to approve an additional $4.5bn in costs for the project, which includes the country’s national energy company ENH and Japanese energy group Mitsui as partners.Analysts say that the oil majors may use the security situation as a negotiating chip to push for favourable terms on the restarted projects..© 2025 The Financial Times Ltd.

FT: Gas investments of $50bn into Mozambique hit brick wall. Again.

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