The Cabo Delgado provincial government has confirmed the resumption of compensation payments to communities affected by the natural gas project on the Afungi peninsula, a process that was suspended following the terrorist attack on the town of Palma on 24 March 2021.

Quoted by newspaper O País, provincial governor Valige Tauabo recalled that the suspension was linked to TotalEnergies’ declaration of force majeure on the Mozambique LNG project. “After the extremist invasion, activities came to a halt, which forced the interruption of processes that were already being prioritised. In the meantime, the process has been resumed,” he explained.

Tauabo said that while families directly affected had been resettled, some are still awaiting the conclusion of their individual processes. He stressed that authorities are also monitoring cases involving community members who suffered economic losses as a result of the project’s implementation.

According to the governor, one of the envisaged compensation modalities involved the planting of coconut trees, whose yields could generate future income for families and serve the project’s needs. However, some beneficiaries preferred to receive cash payments directly.

Tauabo said the disagreements over payment modalities required additional clarification, but assured that the process is making progress and moving at a positive pace for the cases that still need to be resolved.

The Mozambique LNG Project on the Afungi peninsula, in the Palma district, was relaunched in January at a public ceremony attended by Daniel Chapo and Patrick Pouyanné, after five years of suspension.

On that occasion, Chapo stated that the project’s resumption would have a direct and significant impact on job creation, both during the construction and operational phases, contributing to the dynamisation of the labour market and the development of the national workforce.

Mozambique LNG: Project Overview

The Mozambique LNG project represents an investment of approximately US$20 billion and is considered the largest private undertaking currently under way in the country. Estimated production stands at 13 million tonnes of LNG per year, with development already approximately 40% complete, according to figures provided by TotalEnergies.

In addition to TotalEnergies, the consortium includes Japan’s Mitsui, Mozambican state company ENH, Thailand’s PTT, and Indian firms ONGC, Bharat Petroleum, and Oil India. The construction contractor is CCS JV, a consortium formed by Saipem, McDermott, and Chiyoda.

Mozambique has three approved development projects for the exploitation of natural gas reserves in the Rovuma Basin, which are ranked among the largest in the world and are all located offshore the coast of Cabo Delgado province.

A study by consultancy Deloitte estimates that Mozambique’s vast natural gas reserves could generate up to US$100 billion in revenues by 2040, positioning the country among the ten largest global producers and accounting for 20% of Africa’s LNG output.