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Mozambique Challenges TotalEnergies’ $2 Billion LNG Delay Costs

The government of Mozambique is disputing claims by TotalEnergies that delays to the country’s massive liquefied natural gas project have resulted in about $2 billion in additional costs.

The disagreement centers on the long-delayed Mozambique LNG project, a $20 billion development that was halted for several years due to security threats linked to Islamist militant attacks near the project site in Cabo Delgado province.

According to reports, Mozambican authorities are not convinced by the French energy giant’s estimate of the cost overruns. An independent audit carried out by UK consultancy Bayphase reportedly failed to fully verify the expenses TotalEnergies said were incurred during the suspension period.

The dispute comes as Mozambique reviews an updated development plan for the LNG project, which is considered one of Africa’s largest energy investments and a potentially major source of export revenue for the country.

Discussions between the government and project partners are continuing as both sides attempt to reach an agreement on the project’s revised costs and future timeline.

TotalEnergies officially restarted the Mozambique LNG project earlier this year after lifting a force majeure declaration that had been in place since 2021. The company suspended operations following attacks by Islamic State-linked militants in areas close to the construction site near the town of Palma.

The prolonged shutdown has significantly delayed the project’s production schedule. Initial LNG exports, once expected much earlier, are now projected to begin around 2029.

The Mozambique LNG project is expected to play a major role in boosting global LNG supply over the coming years while also supporting economic growth in Mozambique.