UK Withdraws Support for Mozambique LNG Project Amid Rising Risks

The UK government is withdrawing financial support for the Mozambique LNG project led by TotalEnergies. Initially offering $1.15 billion via UK Export Finance in 2020, the project was meant to boost African LNG exports but stalled due to regional insurgencies. Britain cites escalating risks as the reason for withdrawal.

The British government has decided to terminate its financial backing for the Mozambique Liquefied Natural Gas project, spearheaded by TotalEnergies. Announced on Monday, this move marks a significant shift in the UK's international energy investment strategy.

In 2020, the UK Export Finance (UKEF) had committed $1.15 billion to this $20 billion endeavor, which aimed to position Mozambique as a leading LNG exporter to both Europe and Asia. However, operations came to a standstill in 2021 due to an escalating Islamist insurgency in the region, prompting concerns over security and investment risks.

British business minister Peter Kyle noted that a recent review highlighted increased risks since the project's initial approval, justifying the decision to end UK involvement to protect taxpayer interests. TotalEnergies has yet to comment on this development.

(With inputs from agencies.)