The International Monetary Fund (IMF) projects that TotalEnergies’ massive liquefied natural gas (LNG) project in Cabo Delgado, northern Mozambique, will resume development in 2024, with first exports anticipated within four years.
According to the IMF’s recent report on the fourth review of the Extended Credit Facility (ECF) program, the onshore LNG project led by TotalEnergies is slated to restart next year.
The report, released this month, notes that while the official resumption of the development phase has not yet been announced, it is expected to begin once project financing is secured.
TotalEnergies, which leads the Area 1 LNG consortium, halted the $20 billion project in 2021 following terrorist attacks in Cabo Delgado.
In response, the company has since conducted a human rights assessment and developed an action plan to support local socio-economic development.
The IMF report forecasts that LNG exports will commence in 2028, a year later than previously anticipated. Meanwhile, the Coral FLNG project, operated by ENI, has achieved 70% of its annual capacity in 2023 and is expected to reach near full capacity in 2024.
However, initial revenues from natural gas exports are projected to contribute less than 0.1% of Mozambique’s GDP in 2023, increasing to 0.6% by 2028 with the start of the onshore project.
Mozambique’s Rovuma basin, which contains some of the world’s largest natural gas reserves, is home to three approved gas projects.
TotalEnergies is developing a plant near Palma for gas production and export, which has been suspended since 2021 due to security concerns.
TotalEnergies’ President, Patrick Pouyanné, acknowledged progress toward resuming the project but did not provide a specific timeline.
He highlighted ongoing discussions with contractors and funders about restarting the project, emphasizing that the situation should be approached gradually.
Mozambique’s President, Filipe Nyusi, has emphasized the importance of resuming the gas megaprojects, citing the improving stability in Cabo Delgado and stating that financial considerations should not impede progress.
The IMF’s report underscores the significant economic impact that the LNG projects are expected to have, reflecting Mozambique’s strategic role in the global natural gas market.
