Mozambique gas plan on track despite violence

23 June 2021 | Economics

Italian energy company Eni on Monday said that an offshore gas project in Mozambique's insurgent-hit north was still on track to start operating in 2022 despite the unrest.

There have been doubts over the viability of liquified natural gas (LNG) exploration sites off Mozambique's Afungi peninsula since militants attacked the coastal town of Palma in March.

The deadly raid on the projects' operational hub forced French oil giant Total to suspend work on a massive US$20 billion LNG project the biggest single investment in Africa declaring a "force majeure" and evacuating all staff.

But Eni, who launched its own LNG project in the area in 2016, said the insurgency had not affected operations.

"Startup of the Coral South project is confirmed in 2022 as per scheduled," an Eni spokesperson told AFP in an emailed response to a query on Monday, without providing further detail.

The completed project is to consist of six subsea wells connected to a floating LNG plant with a production capacity of 3.4 million tonnes, according to Eni's website. All of the gas produced on the site is to be sold to British Petroleum.

Mozambique has set high hopes on vast natural gas reserves discovered in its Cabo Delgado province in recent years, attracting major international companies.US giant Exxon Mobil also invested in the gas projects, which are estimated to be worth US$60 billion in all.

But a spiralling insurgency staged by Islamic State-linked militants, has raised growing security concerns since it first emerged in 2017.

The March 24 attack on Palma struck just 10 kilometres from the nerve centre of Total's LNG project, despite repeated government pledges to protect the site.

The company had already evacuated some workers and suspended construction in January following a series of nearby jihadist raids. It has not yet indicated when its operations may resume. Mozambique had been hoping to reap nearly US$100 billion from the gas fields over the next 25 years. - Nampa/AFP

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