Mozambique: Total LNG project suspended, not abandoned – Carta

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Mozambique: Total LNG project suspended, not abandoned – Carta

4:47 CAT | 21 Apr 2021

CTA's Agostinho Vuma addresses the press in Maputo on Tuesday, April 20 2021. [Screen grab: Miramar]

Almost a month after the terrorist attack on the town of Palma, Total managers in Mozambique are assuring the Confederation of Economic Associations of Mozambique (CTA) that the company has not abandoned but only suspended, for security reasons, the Mozambique liquid natural gas (LNG) project in the Afungi peninsula, Cabo Delgado province.

The guarantee by the French petrochemical company was reported this Tuesday (20th) by CTA president Agostinho Vuma, after meetings with company managers and the French ambassador in Mozambique on the impact of Total’s actions on Mozambican subcontractors.

Agostinho Vuma reported that the preliminary analysis points to 410 companies and 56,000 jobs affected by the March 24 attack on Palma, and indicates a preliminary financial impact of around US$95 million including destruction, late payments and goods in transit without certainty of delivery.

According to Vuma, the district of Mocímboa da Praia is the worst affected, representing around 40% of all of the companies affected and 23% of jobs lost in Cabo Delgado,

In the wake of the terrorist attacks, the CTA raised the private sector’s concerns with Total and the French ambassador.

Among other issues, the CTA highlighted the delay in payments that is becoming a nightmare for the private sector.

In response, “Total informed us [the CTA] that it is working hard to find solutions for ongoing contracts, through contractors, and reiterated that Total does not have any late payments to contractors [but these might have, with subcontractors]. The CTA therefore agreed with Total to create a joint task force to map the pending payments [whose respective goods had been ordered by the contractors], to facilitate, contract-by-contract, the fulfilment of obligations with Mozambican small and medium enterprises,” Vuma said.

To ensure speedy payments, CTA will, for a week, starting today, make available to all companies with pending payments an information collection worksheet.

“Total, as the leader of the business consortium operating in Cabo Delgado, shared the information that it is concerned with the issue of the consequences of these attacks and with the functioning of other institutions, such as EDM, TDM, banks and other entities, as a way to ensure the continuation of the project,” Vuma added.

Regarding the Mayotte Islands, Vuma reported that both the French ambassador and Total said that they do not see it as an option for the LNG project, but only for the installation of hospital services for evacuated staff in cases of illness, since Palma does not [have the necessary conditions to obtain] an international license.

By Evaristo Chilingue

Watch the Miramar report on CTA’s press conference.