Chapo Sees Total LNG Project Restart Within Weeks

Mozambican President Daniel Chapo expects TotalEnergies SE’s $20 billion liquefied natural gas project to restart as early as this month, reviving a potentially key revenue source for the cash-strapped government.

There are already signs of construction preparation at the project that shut in 2021 after insurgent attacks near the site, Chapo said in an interview in Abu Dhabi on Wednesday. He played down the risk that Islamic State-linked militants will halt construction again.

The Mozambique LNG project promised to transform one of the world’s poorest economies and bring in billions of dollars in revenue to the state, some of which it earmarked to pay down debt. Repeated setbacks caused by security concerns have pushed out first exports to 2029, just as a wave of supply from Qatar and the US is forecast to hit the global market.

A restart would be welcome news for Mozambique’s economy that’s also struggling to recover from post-election unrest.

“If everything goes well, we may be able to resume effectively in late January or early February,” said Chapo, who was sworn in as the nation’s leader a year ago. “We are pleased with the way work is progressing.” Total, the operator of Mozambique LNG with a 26.5% stake, previously said it wants the government to approve $4.5 billion in additional costs incurred during the almost five-year freeze before fully relaunching the project.

The sides have agreed to allow the development to proceed while the approval process is under way, said Chapo. He was unable to give a timeline for Mozambique’s audit of costs because of the complexity of the process.

Total, in a response to a request for comment, referred to remarks by Chief Executive Officer Patrick Pouyanné in December that the company is mobilizing workers and contractors at the development.

Chapo said he has an “excellent” relationship with participating international LNG operators and his administration is working with Exxon Mobil Corp. to reach a final investment decision around mid-year on a project planned next to Total’s. He visited the company’s Houston headquarters in October and the oil major lifted its own freeze on activity the following month.

Still, the Islamist militants who have waged a war in Mozambique’s gas-rich Cabo Delgado province since 2017 remain active, despite efforts by various mercenary groups and foreign troops to end the threat. 

The United Nations Office for the Coordination of Humanitarian Affairs tallied a record number of incidents last year, though most of the recent attacks have been smaller in scale. Rwandan forces have helped beat back the insurgency since 2021 and will remain at least through construction of the project.

There are no towns in Cabo Delgado currently occupied by insurgents and activity is minimal, according to Chapo.

“There have been sporadic attacks, mainly at the village level,” he said. “Our security forces are on the ground.”

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