The United Kingdom and the Netherlands have withdrawn a combined $2.2bn in financial backing for the TotalEnergies-led Mozambique LNG project.
The UK government said it was rescinding its $1.15 billion backing for the project after promising in 2020 a $300m loan and insurance worth about $700m for the $20bn project via UK Export Finance (UKEF).
“After a detailed review, the UK government has decided to end UK Export Finance’s participation in Mozambique LNG, Business and Trade Secretary Peter Kyle said in a statement.
“My officials have evaluated the risks around the project, and it is the view of His Majesty’s Government that these risks have increased.”
The Dutch government in the Netherlands also said on Monday that TotalEnergies had withdrawn a $1.1bn export insurance request for the project.
Atradius Dutch State Business authorised $1.3bn in export insurance via two policies, the larger of which has been rescinded at the company’s request, the Dutch finance ministry said on Monday.
This is the latest setback after TotalEnergies revived the project following its suspension in 2021 following militant attacks in the Cabo Delgado province of Mozambique.
The large-scale project will tap into reserves from Mozambique’s offshore Rovuma Basin, which holds some of the world’s largest untapped deposits of natural gas.
The project will develop the Golfinho and Atum gas fields and construct a dual-train LNG plant with a capacity of 13.12 million metric tonnes per year.
Until yesterday, UKEF was one of the investors of the project along with Japan’s Mitsui & Co., Indian Consortium of ONGC Videsh, Bharat PetroResources, and Oil India, Thailand’s PTTEP, Mozambique’s Empresa Nacional de Hidrocarbonetos and US Export-Import Bank.
However, TotalEnergies has confirmed that its Mozambique LNG project will proceed once the government approves the revised field development plan currently under consideration.
Following the lifting of the hiatus on the project, ExxonMobil has also revived plans for its $30bn Rovuma LNG development, which had faced delays due to security challenges in the region.
The American oil giant now expects to reach a final investment decision (FID) in the first quarter of 2026 on the massive onshore gas project.