Force majeure lifted at Mozambique LNG project; Indian firms hold 30% stake

A 53-month-long force majeure at Mozambique's giant LNG project, where Indian firms hold a 30 per cent stake, has ended, enabling the start of work at the USD 21 billion project, ONGC Videsh Ltd said on Wednesday.

Operator and French energy giant TotalEnergies and its partners lifted the force majeure on the project in Mozambique, which had been in place since mid-2021 due to deteriorating security in the northern Cabo Delgado Province of the African nation.

TotalEnergies last week said the LNG deliveries can start by 2029.

"Security situation in Cabo Delgado Province (CDP), north of Mozambique, Area 1 Mozambique LNG Project has significantly improved, and Area 1 Mozambique LNG consortium has accordingly notified the Government of Mozambique to end the Force Majeure which was declared on May 11, 2021," OVL said in a statement. "Withdrawal of the force majeure enables construction activities to restart for early completion of the project."  ONGC Videsh Ltd, the overseas investment arm of state-owned Oil and Natural Gas Corporation (ONGC), owns a 16 per cent stake in the project, while a unit of Bharat Petroleum Corporation Ltd (BPCL) has 10 per cent. Oil India Ltd has another 4 per cent.

The project includes the development of the Golfinho and Atum fields located within Offshore Area 1 and the construction of plants that will turn the gas into its liquid form (LNG) for export to consuming nations on ships. The Area 1 contains more than 75 trillion cubic feet of gas resources, of which 18 Tcf will be developed with the first two trains.

TotalEnergies operates Mozambique LNG with a 26.5 per cent participating interest. ENH Rovuma rea Um, S.A. has 15 per cent, Mitsui E&P Mozambique Area 1 Limited 20 per cent, and PTTEP Mozambique Area 1 Limited 8.5 per cent.

"During the construction of 13.12 million tonnes per annum LNG project, due to the deterioration of the security situation in the north of Cabo Delgado province, the Area 1, Mozambique LNG Project issued a declaration of force majeure in May 2021 and suspended the construction activities that had commenced in 2019," OVL said.