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Africa: Mozambique’s LNG Renewal – Opportunity Amid Security and Secrecy Risks

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Africa: Mozambique’s LNG Renewal – Opportunity Amid Security and Secrecy Risks


Improving security beyond the project site is vital, as is ensuring that gas revenues are managed responsibly and transparently.

The resumption of TotalEnergies’ large natural gas extraction project is an opportunity to transform Mozambique’s abundant natural wealth into economic development, especially for the impoverished northern Cabo Delgado province.

However, the persistent terrorist threat and the lack of transparency in managing public assets could turn this opportunity into a long-term liability.


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The Mozambique liquefied natural gas (LNG) project – with a total investment of approximately US$20 billion – was suspended in March 2021 following a sharp escalation in attacks by local Islamic State-affiliated insurgents. A large-scale assault on the coastal town of Palma forced the shutdown of TotalEnergies’ Afungi site, located just over 10 km away.

The suspension was a major setback for Mozambique, delaying the completion of gas processing facilities and offshore extraction infrastructure that would have enabled LNG exports and generated substantial state revenues.

To stabilise the province, the Mozambican government sought foreign military assistance for counterinsurgency operations from Rwanda and the Southern African Development Community. The European Union also provided military training programmes to strengthen Mozambique’s armed forces.

Nearly five years later, the LNG project has resumed under reinforced security arrangements. Although the situation has improved, terrorist groups are still active in the country’s north, carrying out deadly attacks on a daily basis.

At the relaunch ceremony in Afungi in January, President Daniel Chapo said the project would contribute to national and provincial economic development. Yet this outcome is far from guaranteed.

Security remains the most visible risk. Although insurgents have not demonstrated the capability to directly attack the project site, this is largely due to the extensive security apparatus protecting it.

Rwanda has deployed approximately 5 000 troops in Cabo Delgado, with around 3 000 specifically tasked with securing the LNG project and the nearby towns of Palma and Mocímboa da Praia. A Status of Forces Agreement signed between Mozambique and Rwanda provides for this deployment until at least 2029, when construction is expected to be completed, and exports begin.

In addition to Rwandan forces, Mozambican troops and numerous international private security contractors have been deployed to support intelligence-gathering, surveillance and protection operations. This layered security architecture significantly reduces the likelihood of a direct attack on the LNG site.

However, it also comes at a high financial cost. Security expenditure will ultimately be deducted from project revenues, reducing profits and, consequently, the tax income available to the Mozambican state.

Projections suggest that Mozambique could earn up to US$100 billion in revenues over the approximately 30-year lifespan of gas projects in the Rovuma Basin. However, these estimates did not account for prolonged conflict-related disruptions or the substantial increase in security-related operational costs. The five-year suspension alone may have cost Mozambique an estimated US$4.5 billion in delayed government revenues.

TotalEnergies has stated that it incurred approximately US$4.5 billion in costs during the suspension period and intends to recover these losses from future project revenues before paying taxes. That amount represents around 25% of the project’s original final investment decision value. The Mozambican government initially challenged these claims and requested an audit, but the project resumed before it was concluded or its findings made public.

This raises serious questions about transparency. It remains unclear under what financial terms the project was relaunched and how the disputed costs will affect Mozambique’s future revenues. These concerns are particularly acute given the country’s current fiscal pressures.

Mozambique’s economic growth slowed significantly in 2024 and 2025, while public debt remains high and the government faces increasing difficulty financing essential expenditures, including military salaries and healthcare.

This fiscal vulnerability creates strong incentives for the government to prioritise short-term revenue flows over long-term optimisation. Without transparency and robust oversight, Mozambique risks accepting unfavourable financial terms that could substantially reduce the long-term benefits of its gas resources.

Another major risk lies in the project’s operating model. Activities have resumed under a highly securitised enclave arrangement, which includes a fenced concession area isolated from surrounding communities. At peak construction, around 17 000 workers are expected to be based inside the concession, with limited interaction with local populations.

While this model is justified on security grounds, it restricts local businesses from providing goods and services, and limits direct economic benefits to nearby communities.

This exclusion risks reinforcing local grievances that insurgent groups could exploit for recruitment. The insurgency in Cabo Delgado has already drawn support from marginalised youth who perceive themselves as excluded from economic opportunities associated with natural resource projects. If locals continue to see little tangible benefit from the LNG project, resentment may deepen, potentially undermining long-term stability.