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In May 2020, EXIM voted to amend the agency’s previously approved September 2019 direct loan supporting US exports for the development and construction of the LNG project located on the Afungi Peninsula in northern Mozambique.
The action amended the original scope of EXIM’s financing of the project from exclusively the onshore portion of the LNG plant and related facilities to also allocate an estimated $1.8 billion of the estimated total of $4.7 billion.
However, TotalEnergies declared force majeure on the Mozambique LNG project in April 2021 and withdrew all personnel from the site due to new attacks and the loan needs to be approved again.
Besides TotalEnergies who has a 26.5 percent operating interest, other partners in the Mozambique LNG project include Japan’s Mitsui, Mozambique’s ENH, Thailand’s PTT, and Indian firms ONGC, Bharat Petroleum, and Oil India.
Pouyanne discussed the Mozambique LNG project during TotalEnergies’ 2024 results and 2025 objectives presentation in London on Wednesday.
“We had, as you know, it’s public, a debate with some credit export agencies,” he said.
“I think the one which will be solved quickly is the one on the other side of the Atlantic,” the CEO said.
“I think I would be surprised that President Trump’s administration would be against an LNG project they have approved, by the way, four years ago. So I think it’s a question of weeks. So this is important because it was a big part of the credit export.. it was almost $5 billion,” Pouyanne said.
Contractual rights
“I would remind to some of the other credit export agencies. In fact, all of them but two have approved,” the CEO said.
“The other one that they have signed a contract and that we gave them a lot of money, so I’m ready to exercise all my contractual rights, not me, Mozambique LNG shareholders, because we are only 26 percent of it,” he said.
Pouyanne did not name the country, but media reports suggest it is the UK.
In 2020, the British government agency UK Export Finance (UKEF) committed to providing direct loans and guarantees to support the project with up to $1.15 billion.
2029/2030
Pouyanne noted that he recently met with the new President of Mozambique, Daniel Chapo, to discuss the restart of construction on the 12.8 mtpa Mozambique LNG project.
“The good news, in fact, there is a huge continuity in terms of the security setup,” he said.
“In terms of security, the agreements they have with other countries will remain in place and they are dedicated, I would say, to bring the best they can to the project,” Pouyanne said.
He said the security on the peninsula is not a problem, it is “more the security in the region.”
“On the contractor side, they are all ready to start up again. The project is, we told you, around $20 billion. So there is no change,” he said.
Mozambique LNG’s EPC contractor is CCS JV, a venture between Saipem, McDermott, and Chiyoda.
Pouyanne said the partners were not anticipating in the summer of last year, “these difficulties with the credit export agency in particular there because we had no signal. Then it enters into politics, you know, the politics mixed,” he said.
“So we are victims. But it’s back on track from my point of view, and it’s a matter of weeks,” he said.
Pouyanne said in October last year that TotalEnergies and its partners were working to restart construction on the giant LNG project by the end of 2024.
He said at the time the project was expected to launch operations in 2029.
“Today, I think we told you 2029. If we lose six months, we’re 2029, 2030, but the idea is to be able to launch the project,” he said on Wednesday.