Financial backers are continuing to assess whether they should reaffirm their support for a multi-billion-dollar LNG project in Mozambique as operator Total looks to restart work.

The project was suspended in 2021 after insurgents known as the Islamic State Mozambique attacked Palma, a town in the northern province of Cabo Delgado.

Total declared force majeure and withdrew its staff from the nearby Afungi project site.

But earlier this year, the French energy major announced its intention to restart the project, meaning its financial partners are also expected to confirm their commitment.

A coalition of 124 civil society groups, including BankTrack and Friends of the Earth, have called on financial backers to reconsider their support of the project and urged them to withdraw their funding due to “the continuation of insurgent attacks and the failure of the Mozambican government and TotalEnergies to tackle the drivers of the conflict”.

They also cite “ongoing human rights violations” and “irreversible climate and environmental impacts” as reasons to end support.

The project is backed by a range of public and private financial institutions, including eight export credit agencies (ECAs) and 15 commercial banks.

The ECAs involved are the Export-Import Bank of the United States (US Exim), UK Export Finance (UKEF), the Export-Import Bank of Thailand, Italy’s Sace, Japan’s Nippon Export and Investment Insurance (Nexi), the Export Credit Insurance Corporation of South Africa (ECIC), Atradius DSB of the Netherlands and the African Export-Import Bank (Afreximbank).

Nahuel Mercedes, a spokesperson for Atradius, tells GTR: “At this point the project owner is looking at continuation and has asked all involved ECAs, including ourselves, for approval. Our due diligence is still ongoing and it is unclear what the possible timeline is on a final decision.”

“The Mozambique LNG project has been paused under force majeure since April 2021. We are currently in talks with project sponsors and other lenders, including export credit agencies, regarding the latest status of the project and the potential for the force majeure situation to lift,” a spokesperson for UKEF tells GTR.

A senior US Exim official tells GTR: “No decision has been made yet with respect to the amendment of the approved financing for this project. The amendment request is being processed in compliance with Exim’s standard policies.”

“Exim remains in coordination with the other project lenders. Due to force majeure, no disbursements have been made to date on this transaction,” they say.

ECIC confirmed it was supporting the project.

Afreximbank, the Export-Import Bank of Thailand, Nexi and Sace did not respond to GTR’s request for comment.

None of the banks involved provided a comment. Total did not respond to GTR’s request for comment.

In July 2023, Dutch non-profit UpRights published a review of the human rights due diligence process of the Mozambique LNG project.

It found that Total’s due diligence failed to “accurately assess the potential human rights impact of the project on the security situation of the communities”, nor did it “assess the real risk of being considered complicit in international humanitarian law violations or war crimes allegedly committed by the Mozambican armed forces”.

The project has also drawn criticism from environmental groups. In 2021, Friends of the Earth launched a legal challenge against UKEF’s US$1.15bn investment in the project, arguing it did not meet the government’s Paris Agreement obligations.

After a split judgment in the High Court, an appeals court dismissed the campaign group’s appeal in January last year.

The project financing for Mozambique LNG, signed in July 2020, is the largest-ever for the continent at a total of US$14.9bn.

Conflict has been ongoing in the region since 2017 and more than a million people have been displaced.