Mozambique's $50bn LNG Pipeline Faces Security Concerns and Oversupply Fears

Mozambique's President Daniel Chapo has urged the country's private sector to take advantage of a pipeline of liquefied natural gas (LNG) projects worth around $50bn.

The Rovuma Basin, located off Mozambique's northern coastline, holds an estimated 130 to 140 trillion cubic feet of recoverable natural gas, attracting several major energy companies including Eni, TotalEnergies, and ExxonMobil.

These companies are developing large-scale export projects that represent more than 40 million tonnes per annum (mtpa) of LNG capacity. However, the country's LNG ambitions have faced major hurdles, including security concerns and a potential oversupply of LNG in the market.

TotalEnergies' $20bn Mozambique LNG project has secured financing, but its development has been affected by force majeure declarations due to Islamist insurgent attacks. The UK government and Dutch export credit agency Atradius have withdrawn $1.47bn in export finance from the project, citing security concerns.