The U.S. Export-Import Bank has granted final approval for a nearly $5 billion loan to support the long-delayed liquefied natural gas (LNG) project in Mozambique, marking a significant step towards resuming development. The project, spearheaded by French energy giant TotalEnergies, had previously secured a $4.7 billion commitment under the Trump administration. However, after construction was suspended in 2021 due to violent unrest in the northern Cabo Delgado region, the financing required re-approval before any funds could be disbursed.
TotalEnergies CEO Patrick Pouyanne recently expressed confidence that U.S. financial backing would be reinstated, with additional support from the UK and Dutch export credit agencies expected in the coming months. Mozambique’s Energy Minister Estevao Pale also indicated that these agencies were likely to reaffirm their commitments. The lifting of the force majeure declaration, which has been in place since 2021, hinges on these approvals.
TotalEnergies holds a 26.5% operational stake in the Mozambique LNG project, which was originally intended to position the country as a major player in the global LNG market. However, progress came to a standstill when an Islamic State-linked insurgency swept through the region, forcing a halt to construction. In recent months, security conditions have reportedly improved, with Mitsui, a project partner, stating in December that preparations were being finalised to resume work following negotiations with contractors.
Despite the renewed momentum, environmental groups remain opposed to the project, citing ongoing security concerns, human rights violations, and potential environmental risks. Daniel Ribiero, technical coordinator for Friends of the Earth Mozambique, argued that the combination of armed conflict, human rights abuses, and economic uncertainties should have deterred investors from supporting the development.
With key financial approvals now falling into place, attention will turn to the project’s next steps, including the anticipated restart of construction and the broader implications for Mozambique’s energy sector.
