Maputo (MOZTIMES) – A high-level correspondence letter between TotalEnergies CEO Patrick Pouyanné and the President of Mozambique, Daniel Chapo, leaked to the press and social media last Saturday, fuelling breaking news about the lifting of the Force Majeure by the Mozambique LNG project concessionaire, TotalEnergies.
The leaked letter’s content is of major news value, which explains its prominence in national and international headlines. The project in question involves an approved investment of USD 20 billion and has been suspended since 2021 due to terrorist attacks in the region. Its resumption would open the door to major business opportunities with both local and international impact.
For years, the announcement of the Force Majeure lifting had been expected, given the improved security situation following the deployment of Rwandan Defence Forces to the districts of Palma and Mocímboa da Praia since mid-2021. What was less expected was that a high-level correspondence of this nature could find its way onto social media barely 24 hours after being received by the Office of the President.
The letter was sent on Friday, 24 October, and on the same day was registered at the Office of the President, bearing the stamp and signature of the official who received it. By the following Saturday (25), the document had already made headlines in major news agencies and was circulating in WhatsApp groups sharing relevant information about Mozambique. TotalEnergies quickly moved to confirm the authenticity of the letter to leading international news agencies.
It is true that in the age of smartphones and social media, all it takes is one person with a phone to photograph or scan a document and spread it widely. But the question is: who had an interest in having the letter disclosed in the manner it was? The Government of Mozambique certainly had no interest in the disclosure, since its content places responsibility on the Mozambican executive for the effective resumption of the Mozambique LNG project.
In the letter, the CEO of TotalEnergies announces that the concessionaire has decided to lift the Force Majeure but makes the full relaunch of the project conditional upon government action, which, he writes, has been pending since 2 October.
“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 on 2nd of October 2024. 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”.
This message from the CEO of TotalEnergies to President Chapo represents clear pressure on the Government to approve new project conditions that are evidently disadvantageous to Mozambique. The increase in the project’s cost by USD 4.5 billion means that this amount will automatically be deducted from the taxes the concessionaire would otherwise pay to the State. In other words, the Government will forgo USD 4.5 billion in fiscal revenue, since these are recoverable costs. Moreover, the new schedule extends the project timeline by an additional ten years, which will naturally bring further recoverable costs.
By making this letter public, TotalEnergies's pressure on the Government—and, ultimately, on President Chapo—has now become public pressure on the executive. All those who read the news that TotalEnergies has lifted the Force Majeure but is awaiting the Mozambican Government’s approval are now demanding immediate action from the authorities.
However, the issue is not as straightforward as it may seem. The Government’s decision to approve the additional project cost for Mozambique LNG carries implications beyond the immediate loss of USD 4.5 billion in tax revenue. It could also set a dangerous precedent, allowing TotalEnergies to continue passing on expenses related to subsequent project costs to the government, thereby progressively reducing the taxes payable. Other LNG concessionaires may follow the same path, a spillover effect.
In this context, it is not surprising that the letter's leak was poorly received within government circles. And, judging by the words of the Council of Ministers’ spokesperson on Tuesday, at the end of the weekly cabinet session, it seems Maputo has little doubt about who leaked the document.
Inocêncio Impissa told journalists that “it is a letter that should have been addressed in a closed context to the President of the Republic, but we were surprised to see it circulating on social media”. He added, “The first thing we do is repudiate this format. The most appropriate approach is to discuss such matters through the proper established channels.”
With these remarks, there seems to be little doubt about whom the Government believes to be responsible for the leak. What remains to be seen is whether the executive will resist the conditions imposed by the concessionaire for the project’s resumption—conditions now made public by the very hand of the TotalEnergies CEO in a letter to the President, which nevertheless ended up on social media.
The positive side is that everyone now knows TotalEnergies is demanding an additional USD 4.5 billion in project costs and a ten-year extension, and that the Government of Mozambique does not consider these demands beneficial to the country.
If TotalEnergies’ proposal is approved as it stands, the Government will emerge weakened. But if it manages to reduce the costs or timeframe demanded by the multinational, it will emerge strengthened in its defence of Mozambicans’ interests against companies in an industry often perceived as predatory – one that seeks to maximise profits while leaving few benefits to the people who are the true owners of the resources.
In his remarks to journalists, Impissa said it is up to the Government to take a position on TotalEnergies’ proposals, suggesting that Mozambique will not yield to Total Pressure. (MT)
