The U.K. and Dutch governments ended their planned financial support for a liquefied natural gas project in northern Mozambique gas project on Dec. 1, citing increased risks and updated assessments of the region’s security and human rights conditions. Officials in both countries announced the decisions Monday, withdrawing public financing that had been under review for several years.
Governments outline reasons for withdrawal
U.K. Business Secretary Peter Kyle said the government would not proceed with more than $1 billion in support previously approved for the TotalEnergies-led development. In a written statement, he said officials determined that project risks had risen since the original 2020 decision. He added that the U.K. Export Finance will reimburse the premium already paid and that the U.K. remains committed to ongoing cooperation with Mozambique gas project outside the project.
Dutch Finance Minister Eelco Heinen told parliament that the Netherlands would also end its involvement. He said the decision followed a government-commissioned study that documented patterns of human rights violations by Mozambican security forces in the region after a large-scale attack in March 2021. Heinen said researchers considered published accounts of alleged abuses credible but did not assess TotalEnergies’ knowledge or role.
Security incidents shape assessments
Security conditions around the project have been a central factor in the governments’ reviews. In March 2021, an armed group affiliated with ISIS attacked the town of Palma, which is adjacent to the gas site. Local surveys reported more than 1,000 fatalities and hundreds of abductions involving residents and workers. A separate 2021 episode involving a Mozambican military unit was reported to have resulted in civilian deaths near the project area.
Following the Palma attack, TotalEnergies declared force majeure, suspending its obligations until conditions stabilized. The declaration prompted both the U.K. and Netherlands to pause their export credit and loan guarantees. TotalEnergies has previously said it has no knowledge of the alleged 2021 incidents involving security forces and has not received information indicating the events occurred.
Differing perspectives on project impact
The project has drawn a wide range of views from governments, researchers, civil society groups, and affected families. Environmental organizations have raised concerns about long-term emissions associated with the development and have urged governments to reconsider public financing. They point to estimates that gas from the field could produce significant greenhouse gas output over its lifetime. Community groups in Mozambique gas project have discussed both the potential economic benefits of job creation and infrastructure, and the challenges posed by instability in the region.
Kyle said continuing support would not advance U.K. interests, while Heinen cited the need for clarity around human rights conditions. Both governments emphasized risk factors rather than a single determining cause.
Ongoing attention to the region
The decision to withdraw support marks another shift in the international response to the situation in Cabo Delgado province, where efforts to expand natural gas production have been affected by conflict and displacement. Economic development plans remain important for regional authorities, but security conditions continue to influence investor and government decisions.
Families affected by the 2021 violence expressed support for the U.K.’s announcement. TotalEnergies has continued internal assessments of the project and has stated in public communications that it will review conditions before any resumption of full activity. The company and the Mozambican government have maintained that the development could play a substantial role in the country’s economic growth once security concerns are addressed.
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