Mozambique LNG project seeks 10-year extension to partially offset US$4.5 billion losses from force majeure

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Mozambique LNG project seeks 10-year extension to partially offset US$4.5 billion losses from force majeure

3:28 CAT | 27 Oct 2025

FILE - For illustration purposes only. {File photo: TotalEnergies]

The Mozambique LNG Project, has proposed to the Mozambican Government a 10-year extension of the concession for the gas megaproject in Cabo Delgado, to “partially compensate” losses of US$4.5 billion resulting from four years of force majeure suspension.

A letter signed by the president of TotalEnergies, the project’s operator and leading shareholder, addressed on Friday to the Mozambican President and informing him of the decision to lift the ‘force majeure’ clause that had kept the project suspended since 2021, explains that the extension request is intended to “compensate partially the economic impact” of the halt caused by the terrorist attacks in Cabo Delgado, while noting that security conditions are now in place for the project’s resumption.

“In order to compensate partially the economic impact of the extended Force Majeure on the Project economics, the Concessionaire respectfully requires the Government to grant an extension of the term of the Golfinho-Atum Development and Production Period under the EPCC [Exploration and Production Concession Contract] by a duration of 10 years, without prejudice of clause 25.4 of the EPCC,” reads the letter.

The “optimisation” of the financial obligations of the Mozambican state oil and gas company ENH is also foreseen. “As a counterpart of such license extension, the Concessionaire would agree that the terms of the ENH Funding Agreement […] shall be amended,” the letter reads. ENH, which is part of the consortium for Area 1 of the Rovuma Basin in northern Mozambique.

The letter, which Lusa accessed on Sunday, details that “as a final step before fully relaunching the project,” the Mozambique LNG Concessionaire “looks forward to receiving the approval by the Government of Mozambique of the revised project cost and schedule,” as submitted to the Ministry of Energy.

“This revised budget’s approval shall cover the incremental costs incurred by the project due to the ‘Force Majeure,’ which amount to 4.5 billion dollars, on which the government has conducted an audit for the years 2021 to 2024, the report of which the Concessionaire is expecting to receive as soon as possible,” the letter reads.

“Moreover, the prolonged Force Majeure Suspension Period has significantly impacted the project’s schedule,” the letter notes, indicating that the first delivery of Liquefied Natural Gas (LNG) from the first train to be installed in Afungi, Cabo Delgado, has been postponed from July 2024, as initially planned, to the “first half of 2029.”

“As a consequence of the Force Majeure, in application of clause 25.4 of the EPCC, the term of the Golfinho-Atum Development and Production Period shall be extended by 4.5 years (54-month Force Majeure period, from 24th March 2021 to 9th October 2025),” the letter adds.

Mozambique LNG is owned by TotalEnergies (26.5%), Japan’s Mitsui (20%), ENH (15%), Bharat Petroleum (10%), Oil India (10%), ONGC Videsh (10%), and Thailand’s PTTEP (8.5%).

P.Pouyane (CEO of TotalEnergies) confirms to D.Chapo (PR of Mozambique) that “the Mozambique LNG Concessionaire has taken the decision to lift the Force Majeure.” pic.twitter.com/pB4iGCDwuD

— Cabo Delgado (@DelgadoCabo) October 26, 2025

At issue is a US$20 billion megaproject led by the French oil company, the progress of which has been constrained over the past four years by terrorist attacks in the northern province of Cabo Delgado.

“The Mozambique LNG consortium has decided to lift the ‘force majeure’ and the Mozambican Presidency was officially informed on Friday through a formal letter,” an official TotalEnergies source, leader of the consortium in Area 1 of the Rovuma Basin, told Lusa on Saturday.

“As a final step before the full relaunch of the project, Mozambique’s Council of Ministers needs to approve an addendum to the Development Plan (PoD) with the updated budget and schedule,” the source added.

READ: TotalEnergies and partners lift force majeure on $20 billion Mozambique LNG project – Reuters

The president of TotalEnergies announced on 30 September the forecast start in 2029 of LNG production from the megaproject in Mozambique: “Everything is ready. In fact, we are remobilising on the ground.”

This is an investment led by TotalEnergies in Cabo Delgado, with an estimated production of 13 million tonnes per annum (mtpa) of LNG, which, according to the oil company, is currently 40% developed.

In 2021, following violent terrorist attacks in the area, TotalEnergies invoked the “force majeure” clause and suspended activities due to the terrorist attacks in Cabo Delgado, when construction was underway on a plant for the production and export of natural gas in the Afungi bay.

Mozambique has three LNG megaprojects off the coast of Cabo Delgado, with only Eni’s Coral Sul — and now Coral Norte — having advanced in the province’s offshore area. The others are onshore, namely on the Afungi peninsula.

Source: Lusa