The general director of Exxon Mobil Mozambique says his company needs long-term stability in Cabo Delgado province before it can think of restarting a $30 billion liquefied natural gas project in northern Mozambique.
Suspected Islamist insurgents forced the suspension of the project in 2021, when they attacked a town near gas projects managed by French company TotalEnergies and Exxon Mobil.
“The key question is security risks,” said Arne Gibbs, the general director. “We are working with the government to mitigate, and every large capital project has a significant amount of capital risks that need to be resolved.”
Exxon’s project is located next to another huge LNG facility that is being built by TotalEnergies. On Wednesday, Mozambican President Filipe Nyusi expressed optimism that TotalEnergies would resume construction of its project. He said the cooperation and coordination with the company was very favourable.
Mozambique, among the poorest countries in the world, holds presidential elections next year, when Nyusi’s second term in office ends. Analysts see the election as an opportunity for the ruling Frelimo party to boost its popularity and defuse growing frustrations over unemployment and poverty.
Mozambique’s constitution states the president is limited to two terms. So far, Frelimo has not picked a candidate to be Nyusi’s successor, fuelling speculation that Nyusi might seek a third term.
Calton Cadeado, a lecturer in international relations and security studies at Mozambique’s Joaquim Chissano University in Maputo, said the political uncertainty might influence decisions by foreign companies scrambling to tap Mozambique’s vast natural resources.
While Islamist militants continue to attack places in Cabo Delgado, he said security was not the big issue it once was.
The security issues “are almost solved. Not 100 percent. But now what is preventing Total to return is more a political than security issue,” he said. “And this third term issue is … somewhere in the mindset of those who want to be sure that stability will prevail in Mozambique.”
Frelimo has not formally expressed a third term wish, but last September, it elected Nyusi unopposed to a third five-year term as leader of the party.
Cadeado said as long as Nyusi’s successor is not revealed, companies willing to invest in Mozambique will simply sit back and watch. They are “ready to work under certainty instead of uncertainty. … But at this point they don’t know what is going to happen,” he said.