Maputo, 19 Jan (AIM) – The International Monetary Fund (IMF) believes that the French oil and gas company, TotalEnergies, which heads the Mozambique LNG project, located on the Afungi peninsula, Palma district, in the northern province of Cabo Delgado, may resume operation early this year as a result of improved security conditions.
According to a recent IMF report assessing implementation of the 36-month Extended Credit Facility (ECF) programme in Mozambique, “security conditions in Cabo Delgado continue to improve and the major Liquefied Natural Gas (LNG) project that was halted in April 2021 is expected to restart in early 2024.”
The IMF announcement strengthens the optimism expressed by Mozambican President Filipe Nyusi in December, when he said that Total Energies may resume operations “in the next three months.”
The natural gas terminal that TotalEnergies started building on the Afungi peninsula, is considered one of the largest investments of its kind in Africa, but the work has been at a standstill since 2021, following the terrorist attacks in Palma district.
The IMF report also claims that annual growth of the Mozambican economy was 5.9 per cent at the end of the third quarter of 2023, but was still “below potential and with the construction sector continuing to contract.”
In April 2021, TotalEnergies declared force majeure to suspend all activities on the LNG project, due to a major terrorist raid against the town of Palma.
The Mozambique LNG Project, budgeted at 20 billion dollars, began with the discovery of reserves of over 65 trillion cubic feet of natural gas in the Rovuma Basin, which led TotalEnergies and its partners to take a Final Investment Decision in 2019.
The project includes two gas liquefaction units to be built on the Afungi Peninsula, with an expansion capacity of up to 43 million tonnes per year.
(AIM)
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