THE United States Export-Import Bank has given the green light to a $5bn loan to support Mozambique’s long-delayed liquefied natural gas (LNG) project. According to a report from Reuters, this approval clears a crucial hurdle in reviving the $20bn project led by French energy giant TotalEnergies.
The financing deal had initially been approved in 2020 under President Donald Trump’s first administration, when the bank agreed to a $4.7bn loan for the development. However, the project was placed on hold in 2021 due to escalating violence in northern Mozambique’s Cabo Delgado region. No funds were disbursed before the suspension.
Fresh approval signals confidence in project stability
The renewed $5bn loan commitment comes after security improvements in the region, raising optimism that construction work on the LNG facilities will resume soon. The project had previously been frozen following a deadly insurgency near the construction site, which forced TotalEnergies to halt activities and evacuate staff.
Officials from the US Export-Import Bank stated that their re-approval signals confidence in Mozambique’s efforts to stabilise Cabo Delgado and the project’s renewed viability.
Mozambique’s LNG ambitions back on track
The TotalEnergies-led LNG project is one of Africa’s largest energy investments and is expected to transform Mozambique into a major player in the global LNG market. The project’s restart would be a significant economic boost for Mozambique, offering job opportunities and increased government revenue.
The $20bn project aims to tap into vast natural gas reserves off Mozambique’s coast, with LNG exports primarily targeting Asian and European markets. The development is also viewed as a key element in meeting future global energy demand.
Regional security remains a concern
Despite improvements, security challenges in Cabo Delgado remain a concern for investors. The Mozambican government has intensified military operations in the region with the support of international forces, including troops from Rwanda and the Southern African Development Community (SADC).
TotalEnergies has also made it clear that safety is a top priority. Before resuming full operations, the company plans to conduct comprehensive assessments to ensure the safety of its personnel and local communities.
A step forward for Mozambique’s energy sector
The renewed financing from the US Export-Import Bank marks a positive step forward for Mozambique’s energy ambitions. Once operational, the LNG project is expected to make Mozambique one of the world’s top exporters of liquefied natural gas.
