Mozambique's Major Gas Find & Insurgency

The Southeastern African state of Mozambique has a bright future ahead - however, the road toward this future is currently blocked with some serious obstacles. Can the state overcome them, and, if so, how?

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By GeoVane, formerly AR Global Security and Base Rate (Global Guessing, and Crowd Money).

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Southern African Giant?: Mozambique's Major Gas Find

This Southern African state, situated to the North East of South Africa, and the East of Zimbabwe, looks set to become a continental gas titan, and could become the world's 4th largest exporter of natural gas - fundamentally transforming the country.

In 2006, Italian energy giant Eni, was granted a license to explore for gas off the state's North Eastern Coast known as the Cabo Delgado region. After 5 years of exploration, the company announced that it had discovered what it called “supergiant resources”, in the Rovuma basin off the Cabo Delgado coast, that is now estimated to hold 2.4 trillion cubic meters of natural gas - setting the state off on an extraordinary economic journey that could change the country’s fortunes, a journey that will most certainly be bumpy and with many obstacles.

Area one is operated by French company Total, who purchased Anadarko Petroleum’s 26.5% stake in the Mozambique LNG project, for 3.9 billion us dollars in 2019, after Anadarko was acquired by Occidental Petroleum.

Exxon Mobil will lead the construction and operation of all future natural gas liquefaction and related facilities for the deepwater Area 4 block, having a 35.7% stake in the block 25% of which it jointly acquired from Eni in 2017 as part of the Rovuma Joint Venture framework, that has a joint 70% stake in area 4.

The insurgency in Northern Mozambique is somewhat obscure, with the status and nature of groups involved being slightly uncertain, however, the main insurgent group is known as Ansar al-Sunna, known locally as Al-Shabaab with this group being in no way directly connected to the militant group in Somalia. Ansar al Sunna’s activities can be traced back to 2015, and its ideology is rooted in its radical interpretation of Islam introduced to the region by young former expats who returned to the country having studied in Sudan, Saudi Arabia and the Gulf States. Ansar al-Sunna claims that Islam, as practiced in Mozambique, has been corrupted and no longer follows the teachings of Muhammad.

A series of interrelated factors including, wide scale poverty, lack of economic opportunity, social marginalisation and seemingly vague promises of regional development through LNG projects have only served to fuel the insurgency in Cabo Delgado.

The country has turned to private military companies to assist in the kinetic aspects of the insurgency, as well as operational support and intelligence.

In August 2019, according to the Jamestown Foundation, Mozambican President Filipe Nyusi met with Putin in Moscow and urged Russia to invest in his country, promising a wide range of lucrative deals and contracts. This development also came after a previous 2017 agreement between the two countries to increase military-technical cooperation.

To defeat the insurgency, the government must first strip it of its territory. By doing so, gas works can go on unhampered in the Rovuma basin, in turn, injecting cash into the government budget which can then be used to raise the living standards not only across the country, but also in Cabo Delgado. Over 700 troops already guard gas facilities in Cabo Delgado, with the government signing a memorandum of understanding on security with Total after violent incidents involving its staff and insurgent forces. However, the government must be careful to manage the perception of the protection of gas facilities - emphasizing the importance of gas revenue for raising living standards, and avoiding giving the impression that its interest is solely in protecting large multinational companies.

If the country manages to quell its insurgency, and kickstart its economic development using gas generated revenue, then it will be in an advantageous geostrategic position.