- The French oil and gas giant wanted an extension twice as long as the period in which the LNG project was paralysed
- The value of the costs incurred during the forced stoppage has yet to be decided
by MOZTIMES
Maputo (MOZTIMES) – The Mozambican Government has approved a Resolution which determines that the period for the Development and Production of the Mozambique LNG Project should remain the 30 years that was initially envisaged. In practice, this means that the extension of the contract between the Government and TotalEnergies will correspond only to the exact period that the project was paralysed due to the declaration of Force Majeure in March 2021.
Last October, TotalEnergies sent a letter to President Daniel Chapo requesting approval of additional costs to the value of 4.5 billion US dollars, supposedly incurred because of the declaration of Force Majeure, as well as an extension of 10 years to the contract to compensate for the period of paralysis, which was only four and a half years (from 24 March 2021 to 9 October 2025).
The Government has approved the holding of an independent audit of the costs declared by TotalEnergies, the results of which must be validated by the authorities, and rejected the request for a 10 year extension to the contract.
“The period of 30 years for the initial Development and Production lifespan is hereby assured as established by Resolution No. 5/2018, of 7 February, which approves the Development Plan for the Golfinho/Atum Field, located in the northern part of Offshore Area 1 of the Rovuma Basin, to attend to the suspension determined by the Force Majeure and the subsequent remobilisation”, says Resolution No. 42/2025, approved by the Council of Ministers on 19 November and published later.
With this decision, the dispute between the two sides is practically closed. There remains to be decided only an agreement on the final value of the costs incurred during the period of Force Majeure. Costs that are approved will be recovered by the company through fiscal deductions from the taxes to be paid to the state, resulting from the export of liquefied natural gas. The first production and export are forecast for the first half of 2029. (MT)
