Mozambique and France’s TotalEnergies have agreed to relaunch construction of their long-delayed $20 billion liquefied natural gas project in the northern province of Cabo Delgado, following improved security conditions after years of militant violence that forced work to stop in 2021.
The agreement was announced on Thursday at Afungi, near the project site, where TotalEnergies CEO Patrick Pouyanne said offshore vessels have already begun installing key infrastructure, signalling the start of a major ramp-up in activity.
TotalEnergies, the project’s operator and largest shareholder, said it now aims to deliver first LNG by 2029 while keeping the development within its original $20 billion budget.
The project, with a planned capacity of 13 million metric tons of LNG per year, is expected to turn Mozambique into a major gas exporter and provide a long-term boost to the country’s economy, one of the poorest in Africa.
Work on the project was halted after Islamist insurgents attacked Cabo Delgado, but security around the Afungi site has improved significantly, helped by the deployment of Rwandan troops.
Despite this progress, the project continues to face challenges, including higher costs, financing constraints and concerns over human rights, which previously prompted some investors to withdraw.
TotalEnergies has told the Mozambican government that costs have risen by about $4.5 billion during the nearly five-year suspension and has sought a 10-year extension to the development and production period as partial compensation.
President Daniel Chapo said negotiations on the revised costs would proceed once an audit is completed, but stressed that talks would not delay the project’s restart.
Pouyanne added that TotalEnergies has already received an automatic licence extension to cover the construction delay.
As part of its renewed engagement, TotalEnergies said it would provide 200 million meticais to support Mozambique in dealing with recent flooding.
The company has also trained about 4,500 workers for the project, including 1,500 young people in nearby Palma in trades such as carpentry and electrical work needed for the plant’s construction.
The Mozambique LNG consortium is led by TotalEnergies with a 26.5% stake, alongside Japan’s Mitsui, Mozambique’s state energy firm ENH, India’s Bharat Petroleum, Oil India and ONGC Videsh, and Thailand’s PTTEP.
The project shares some infrastructure with Exxon Mobil’s Rovuma LNG development, which is also expected to restart.
President Chapo said the LNG ventures could generate up to $35 billion in government revenue over their lifetimes through taxes and profit shares, providing a major boost to Mozambique’s public finances.