Maputo, Mozambique, April 21 – France’s Total has suspended contracts with at least two companies building infrastructure to support a multi-billion-dollar gas project in Mozambique which has been left abandoned after a jihadist attack, the southern African country’s main business association said Tuesday.
Total shut its operations in Mozambique’s northern Cabo Delgado province in early April, withdrawing all staff days after Islamic State-linked jihadists raided the nearby town of Palma on March 24.
The oil giant had already evacuated some workers and suspended construction work on the $20 billion gas project in January following a series of jihadist attacks near the exploration site.
The Confederation of Economic Associations of Mozambique (CTA) on Tuesday said Total had suspended contracts with a series of businesses indirectly involved in the gas project.
The companies include an Italian construction firm contracted to build a resettlement village and a Portuguese public works company tasked with building a new airport.
“The impact of the (jihadist) attacks negatively affected 410 companies and 56,000 employees,” CTA president Agostinho Vuma told reporters after meeting the French ambassador and a Total representative in the capital Maputo on Tuesday.
“Small and medium-sized local enterprises have already lost $90 million” since the attack on the northeastern town of Palma, he added.
Vuma said the CTA was still assessing the number of contracts that had been suspended and whether subcontractors had been paid.
He said Total had assured “in an earlier meeting” that the gas project would resume “once it is safe”, noting that the company had paid all its due invoices.
A Total spokesperson declined to comment.
Gas-rich Cabo Delgado has been battered by a bloody jihadist insurgency since 2017.
The violence has killed at least 2,600 people and displaced nearly 700,000, raising doubts over the viability of the biggest single investment in Africa even before the latest raid.
March’s attack on Palma took place just 10 kilometres (six miles) from the gas project’s nerve centre, despite a government commitment to set up a 25-kilometre (15-mile) security radius around the site.
Dozens were killed in the assault, according to provisional government tallies.
Hundreds of others, including many foreign workers, were evacuated by air and sea while thousands of locals walked to nearby districts.