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France Total declares force majeure on Mozambique LNG project
4/26/2021 12:00:00 AM

France's Total has declared force majeure on its Mozambique LNG project and removed all staff from the site on the Afungi Peninsula, it said April 26.

Total had already suspended plans to resume construction work at Mozambique LNG and cut staffing levels to the minimum in late March after attacks on the nearby town of Palma in the north of the country.
In the latest move, the company has removed all staff and declared force majeure. "Considering the evolution of the security situation in the north of the Cabo Delgado province in Mozambique, Total confirms the withdrawal of all Mozambique LNG project personnel from the Afungi site," it said in a statement.
"This situation leads Total, as operator of Mozambique LNG project, to declare force majeure," it said.
"Total expresses its solidarity with the government and people of Mozambique and wishes that the actions carried out by the government of Mozambique and its regional and international partners will enable the restoration of security and stability in Cabo Delgado province in a sustained manner."
Total had been reported to have been reviewing agreements with contractors on the project in light of the escalation of violence in the country and its suspension of work.
By declaring force majeure, Total will likely be freed from certain obligations to its contractor partners.
Total had hoped to produce the first LNG from the project in 2024, however, with the force majeure declaration, this timeline could be in doubt.
Recent attacks
Dozens of people were killed in the attacks by Islamist militants during the offensive against Palma in late March close to the site of the LNG project on the Afungi peninsula.
Total on March 24 had signaled a restart of work at Mozambique LNG -- designed to have a capacity of 13.1 million mt/year -- after security was beefed up following an escalation of the Islamist insurgency in the country at the end of 2020.
However, the attacks in Palma began at almost the same time as Total issued its statement on March 24.
The plan announced March 24 to resume work came after the government of Mozambique declared the area within a 25 km perimeter surrounding the Mozambique LNG project as a special security area.
Almost immediately, however, the offensive against Palma -- which is said to be within the 25 km perimeter -- began.
Mozambique's more than three-year-old insurgency saw militants close in on the site of the project on the Afungi peninsula -- also home to ExxonMobil's planned 15.2 million mt/year Rovuma LNG project -- at the end of 2020.
It highlights the continued security issues facing the southeast African country and its fledgling LNG industry.
More than 30 million mt/year of LNG production capacity is under development in Mozambique as the country looks to join the ranks of the world's biggest LNG exporters.
Source: SP Global