Insurance

US okays $1.5bln insurance for Mozambique gas project

The US has set aside US$1.5 billion for political risk insurance in the gas-rich northern Mozambique region ravaged by an Islamist insurgency for the past three years, its Maputo embassy said Thursday.

The International Development Finance Corporation (DFC) has “agreed to provide up to $1.5 billion in political risk insurance to support the commercialization of natural gas reserves” in Mozambique’s Rovuma basin, the embassy said in a statement.

The insurance is poised to cover the construction and operation of an onshore natural gas liquefaction plant and support facilities being developed by energy giants including American firm ExxonMobil, French’s Total and Italian’s Eni.

The gas project, one of Africa’s largest investment in recent decades, is situated in the Cabo Delgado which has been the scene of the jihadist attacks since 2017.

Although the gas project has not been directly targeted, the extremist attacks pose a serious threat to the success of offshore investment valued at more than $60 billion.

The attacks have so far displaced more than 250,000 people and claimed at least 1,500 lives.

Mozambican troops along with private military companies have so far struggled to end the insurgency.

On August 12 following days of attacks, Islamist militants occupied Mocimboa da Praia, a strategic port city which cargo to develop the region’s offshore gas wealth comes through.

Mozambique, one of the world’s poorest countries, is banking on the gas project to boost its GDP when it emerges as one of the world’s leading natural gas exporters.

AFP

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