Mozambique attack highlights LNG project dangers
Violence raises question marks over safety at planned Anadarko and ExxonMobil facilities
A fatal attack on a convoy of sub-contractors working for Anadarko in northern Mozambique in February may not have specifically targeted the country's fledgling gas industry. But it highlights the potential for future security problems in the region for international oil companies (IOCs).
The attack left one person dead — an employee of a company contracted to build a small airport close to the project site was beheaded — and six injured. It came six months into an armed insurgency, which began with an attack on the town of Mocímboa da Praia in October 2017. However, it was the first time those working with the IOCs in Cabo Delgado province to build infrastructure for planned LNG export projects were directly caught up in the violence.
US independent Anadarko and ExxonMobil plan to build separate, but neighbouring, multi-billion-dollar LNG export facilities on the coast of this remote, largely agrarian area to tap the huge offshore gas reserves of the Rovuma Basin. Anadarko has signed sales and purchase agreements for almost 10mn t/yr of the 12.88mn t/yr capacity of its project, keeping it on course to meet its objective of taking a final investment decision (FID) before the middle of the year. ExxonMobil has said it also plans to make an FID for its facility in 2019.
The involvement of the Anadarko convoy in the attack led to talk of a shift in the insurgents' strategy towards targeting gas projects. The government promised to step up security in the province, fearing further delays to the FIDs, which they would like to happen before general elections in October this year.
However, Anadarko has said the evidence indicates that the convoy and a car belonging to a contractor "encountered an existing event, which did not directly target our contract personnel, nor the LNG project, nor airstrip".
Petroleum Economist spoke to sources in the security and logistics sectors in Mozambique, who have analysed the events of 21 February, to build up a picture of what happened. The convoy was taking Anadarko contractors northwards to the project sites from Mocímboa da Praia, which has the closest airport to the Afungi peninsula where the Anadarko project is being developed, when it came upon a village in flames, under attack by insurgents. The convoy turned around but was shot at by more insurgents in a village through which it had passed earlier.
There has been speculation that the insurgents were lying in wait for the convoy, but it is more likely that they were a reserve force for the group attacking the village up the road — a tactic that insurgents have used before.
After being fired on, the convoy sat stationary in the road for more than an hour waiting for the Mozambican military to arrive, but suffered no further attack, despite its exposure.
The murdered man — an employee of Portuguese construction company Gabriel Couto which is building the Afungi airport — was travelling in a separate car and appears to have been killed when he got out on encountering the attack. The Afungi airport project is designed to help the projects avoid road travel as far as possible, but it is still at least two years away from completion.
The government's response to the attack was unprecedented, with interior minister Jaime Basílio Monteiro promising to send various units of the country's defence and security forces to bolster security around the projects and the companies working on them.
His promises were enough for Anadarko to say that "we expect to continue moving the project toward FID, according to our current schedule", thanks to the government's "response and other ongoing security measures".
The authorities' muscular response to the February attack has stoked resentment among the local population, who were already complaining that their safety was a lower priority for the government than that of the gas projects. Hundreds of villagers have been murdered since the insurgency began.