Mozambican authorities say that ExxonMobil has assured them it would continue with its natural gas projects in the north of the country.
Max Tonela, Mozambique’s Minister of Mineral Resources and Energy, says that he and his men have been exchanging information with the US major “and the indication we got was to reaffirm the Afungi project”.
The government is expecting ExxonMobil representatives to visit Maputo in early November 2021, to assess the situation in relation to projects in Mozambique.
ExxonMobil has been quiet about the 15Milllion Metric Tonne Liquefied Natural Gas (LNG) project in Area 4, which it leads. The company had, by 2019, “awarded a contract for the engineering, procurement and construction for the Rovuma LNG onshore liquefied natural gas production complex to a consortium made up of JGC, Fluor and TechnipFMC (JFT)”, it said in a statement which is still on its website. “The award enables the start of activities for the Rovuma LNG project, as approved by the government of Mozambique in June 2019, while the Area 4 partners continue to work toward a final investment decision (FID) in 2020”.
The FID didn’t happen, and of the three majors involved in LNG projects in the country, ExxonMobil is the only one that has not said a word about going forward or cancelling. That silence has bred speculations o about the company’s plans.
The World Street Journal sounded very authoritative in a report in late October 2021, that ExxonMobil Corp board was “debating whether to continue with several major oil and gas projects amid a global push from investors for fossil fuel companies to be more cost-conscious and green-energy friendly”. It said the “board members expressed concerns about …a $30Billion liquefied natural gas development in Mozambique and another multibillion-dollar gas project in Vietnam”. I added that “the annual projected emissions from the Mozambique and Vietnam projects were among the highest in Exxon’s planned pipeline of oil and gas projects, according to a pre-pandemic internal analysis by Exxon, which was reviewed by the paper”.
ExxonMobil has already spent $2.8Billion to acquire its operator role and equity in the Area 4 project. But the immediate pretext for slowing down has been the flare up of terrorism in the natural gas rich Cabo Delgado province. 2020 witnessed a high mark in violent attacks claimed by the extremist group Islamic State which had been growing since 2017.The conflict has led to more than 3,100 deaths, according to the ACLED conflict registration project, and more than 817,000 displaced people, according to Mozambican authorities.
Since July, an offensive by government troops with support from Rwanda which was later joined by the Southern African Development Community (SADC) allowed for increased security, recovering several areas where there was rebel presence, including the town of Mocímboa da Praia, which had been occupied since August 2020.
