The future of LNG on both sides of the Ruvuma

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From Cabo Ligado Monthly: November 2021, published 15 December 2021

The commercialization of natural gas reserves in Mozambique and Tanzania will remain central to public safety, national security, and political power in both countries in coming years.

In November, Tanzania started a new round of talks with Equinor and Shell to agree a framework for the mooted liquefied natural gas (LNG) project in Lindi Region. Also in November, a floating LNG facility started its voyage from South Korea to Mozambique’s offshore Area 4. Total’s Senior Vice-President Africa Henry-Max Ndong Nzues expressed guarded satisfaction with operations against the insurgents in Cabo Delgado, though stopped short of resuming project development. On 25 November, Mozambique launched its Sixth Licensing Round, with five of 16 offshore blocks being off Cabo Delgado province. All these projects have varying timelines but will inevitably affect the security situation on both sides of the border for years to come.

On 8 November, talks concerning a host government agreement for Tanzania’s LNG project officially re-commenced with energy companies. Though the aim of completing the talks by May 2022 is unlikely to be met and a final investment decision is likely a long way off — and may never come — heightened activity can be expected in Lindi town, the future site of the LNG plant, and Mtwara town, a base for any future offshore developments of the southerly Shell operated fields. Much of this will be positive, particularly for Tanzanian private sector investment. Yet, recent history has some lessons for how such activity may be received locally, and its potential impact on political violence. 

In January and May 2013, in Mtwara, Tanzania experienced its greatest outbreak of civil unrest since the Majimaji rebellion over 100 years before. In December 2012 and January 2013, mass demonstrations were held to protest a proposed natural gas pipeline, under the slogan “Gesi Haitoki Mtwara” (the gas is not leaving Mtwara). The demonstrations were led by some Mtwara NGOs, local branches of opposition political parties, and religious leaders both Christian and Muslim. The demonstrations were followed by seemingly organized violence across Mtwara Region.

Clashes in January saw politicians’ homes, a prison, government and ruling party offices, and government vehicles attacked. Mtwara town, Tandahimba, and Masasi were all affected. Clashes occurred again in May after the presentation in parliament of the budget for the Ministry of Energy and Minerals. This led to the deployment of troops in Mtwara town.

Current state concerns about security in the region stem from the violence of that period. The government believed that the 2013 violence was instigated for political reasons, and reacted accordingly. The then-member of parliament for Mtwara Urban was charged with incitement, while a Tanzania People’s Defence Force commander pointed the finger at religious leaders, motorcycle taxi drivers, and city businessmen, accusing them of organizing the violence. Less publicly, informants in Mtwara town have spoken of Salafist elements having had a hand in the violence.

The lesson for 2021 and beyond is that the use of violence in response to LNG development is not restricted to extremists. Shell’s natural gas reserves lie close to Mtwara town. Shell and its subcontractors will need to expand their presence in order to develop the reserves, which requires significant infrastructure development. The impact in Lindi will of course be greater if the LNG plant goes ahead. Project benefits will need to be cannily distributed, and rents will need to be managed in politically sensitive ways. 

The security risks in Cabo Delgado are of course more acute. Total suspended operations on its Mozambique LNG project in April 2021 following the attack in March on Palma town by the insurgents, a decision that has contributed to further delays to the ExxonMobil-led Rovuma LNG project. This followed the withdrawal of staff from the project in the face of an insurgent attack in January on Quitunda, which is beside the project site. The attack highlighted France’s strategic interests in at least containing the insurgency to allow the project to go ahead. Rwanda’s success in securing the enclave of Palma town and the neighboring LNG site, while fighting continues across Cabo Delgado and Niassa provinces, confirms for some Rwanda’s role as a proxy for French interests.

The January and March attacks on Quitunda and Palma saw IS propagandists cite France as exploiting Muslim communities, in one case comparing Mozambican gas to West African gold. If Rwandan and Mozambican forces are successful in securing Palma and the Afungi peninsula as an enclave, and resume Mozambique LNG, France may find itself increasingly tied to the project’s security risks. Given Total’s interests in Democratic Republic of Congo, Uganda, and Tanzania, France will undoubtedly continue to exert its influence on security matters across the region.

In the longer term, Mozambique’s 6th Licensing Round too has the potential to drive extremist narratives for years to come, if it is successful. The round, launched in November, will close in October 2022. Three offshore blocks lie off Chiure, Pemba, Quissanga, Ibo, and Macomia districts. Their development will depend on the province’s long term security, or failing that, the development of an expanded coastal enclave. The model that Mozambique pursues to manage the security risks around LNG development — and the success of that model — will have major economic and governance implications on both sides of the Ruvuma. If Mozambique LNG development cannot survive the political upheaval that has grown in its wake, Tanzania is likely to take a much more repressive approach to its own LNG projects.

© 2021, Zitamar LTD. All rights reserved.

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