MOZAMBIQUE A CURSE FOR THE COUNTRY - A WINDFALL FOR THE INDUSTRY
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GAS IN MOZAMBIQUE A WINDFALL FOR THE INDUSTRY, A CURSE FOR THE COUNTRY France thrusts Mozambique into the fossil fuel trap JUne 2O2O
EXECUTIVE SUMMARY
Mozambique: a fossil fuel windfall for the official purpose of assembling a tuna fishing
amid scandal and corruption fleet. In fact, the Mozambique government illegally
contracted debts to finance defence programme, to
Between 2010 and 2013, huge gas deposits were
secure sovereignty over its exclusive economic zone
discovered in Mozambique. Around 5 trillion cubic
and the fossil fuel deposits within it. The affair also
meters were found, making this the 9th largest
involved bribery and several high level actors, including
gas reserve in the world. Over the coming years,
the former Mozambican Finance Minister Manuel
a projected minimum of 60 billion USD is set to
Chang and Credit Suisse bankers, have since been
be invested in the exploitation of these reserves,
prosecuted for corruption and fraud. This colossal
amounting to the largest investment ever made
debt now keeps Mozambique dependent
in Sub-Saharan Africa. A dizzying sum, representing
on the transnational corporations and foreign
more than half of the amount required to face the
powers exploiting these reserves, and the related
coronavirus challenge across the continent, according
gas revenues, even despite the highly unequal
to an estimate by African finance ministers.
contracts granted to the gas industry.
This investment would be 50 times the money
collected by the UN to fund reconstruction efforts
French machinations
in Mozambique after the ravages of tropical
cyclones Kenneth and Idaï in 2019. France was determined for its own transnational
corporations to be the first to profit from this
The sandy beaches of Cabo Delgado province, in the fossil fuel windfall, even at the cost of creating
far north of Mozambique, have become a pot of gold chaos in Mozambique. As early as 2013, the French
for the gas industry and any company with a potential government appears to have turned a blind eye to
stake in massive energy projects. However, this the dubious aspects of this naval contract, raising
‘windfall’ is already proving a curse for the population Mozambique’s debt ratio and implicating itself in
of Mozambique, especially for local communities corrupt practices. France’s aim was not only to save
caught up in an increasingly violent conflict. the financially-troubled Cherbourg shipyards (CMN),
but also to export other kinds of arms and reinforce
Even before the gas projects were formalised, France Mozambique’s navy so that it was equipped to
played the lead role in a corruption scandal related protect future gas infrastructures. At the time, major
to oil and gas exploitation, which flung Mozambique French energy companies were already vying for the
into deep economic and financial crisis in 2016. immense oil and gas reserves. Some were even already
In 2013, the Mozambican government signed a conducting research in the Rovuma basin. This is a
dubious contract with Constructions Mécaniques de highly strategic region for France, which controls
Normandie (CMN), a French company belonging to two thirds of the Mozambique Channel, an exclusive
French-Lebanese billionaire arms dealer Iskandar Safa, economic zone for France thanks to the position of
GAZ IN MOZAMBIQUE A WINDFALL FOR THE INDUSTRY, A CURSE FOR THE COUNTRY 2the Scattered Islands, subject of a sovereignty dispute strategy of militarisation, prioritising protecting gas
between France and Madagascar. infrastructure, at the expense of local communities.
Since then, the dreams of these French companies The major gas operators even paid the Mozambican
have come true, with a great deal of help from public government to mobilise more armed forces troops
authorities. A myriad of French companies in the fossil to protect them. Nothing is being done to act on
fuel industry and adjacent sectors, such as logistics the root political and social causes of the conflict.
and private security, are now involved in the three On the contrary, the militarisation of the zone and
gas projects underway off the coast of Mozambique. the gas operations help feed the underlying tensions
For several years now, the entire arsenal of French perpetuating the violence. Human rights violations
economic diplomacy has been working to defend are on the rise, as the communities find themselves
French interests in Mozambique: diplomatic missions caught between the insurgents, the army, private
attended by heads of industry, public funding, business security contractors and the gas companies and
conventions, the use of the embassy’s economic their subcontractors. Communities are being robbed
services. Diplomatic efforts have ramped up since the of their lands, their access to the sea and their
arrival of Total in September 2019, taking over from livelihoods. Those who try to get word out about the
Anadarko as the main operator of the Mozambique situation, such as journalists and community activists,
LNG mega project. The French government even are being intimidated by government forces and some
opted to support one of the gas projects financially, of them have disappeared. For example, journalist
by granting an export guarantee of over half a billion Ibrahimo Abu Mbaruco has been missing since 7 April
euros to aid its completion. More public financial aid of 2020, with his last message being a text to a colleague
this kind may soon be granted. The four largest private saying that soldiers were coming towards him.
French banks are also deeply involved : Crédit Agricole
and Société Générale are the major players, acting as Given these circumstances, and with the arrival of
financial advisors to the gas operators. Total, French economic diplomacy has been backed
by increased military cooperation between the two
Cabo Delgado, a province erupting countries. Instead of encouraging the Mozambique
in violence government to move towards conflict resolution
strategies that attack the root causes of the violence,
Since October 2017, insurgent attacks have been
France is helping ignite tensions in Cabo Delgado
on the rise in northern Mozambique. The violence
province by supporting multinational gas companies
has resulted in the deaths of at least 1,100 people,
and the militarisation of the zone. French-made
predominantly among local communities. Over
weapons have even been found in the hands of
100,000 people have been displaced. The insurgency,
paramilitary organisations fighting the insurrection,
allegedly associated with ISIS and Al-Shabab, has
including that of Erik Prince, former head of the
fed on a morass of social, religious and political
US mercenary company Blackwater, well known for
tensions, exacerbated by the rising inequality and
its disastrous operations in Libya and Afghanistan.
human rights violations that have arrived with the
With the failure of the Mozambican army, private
gas projects. Confronted with this situation, the
security companies from Russia, the United States,
Mozambique government, abetted by foreign powers
South Africa, and also France, have had an increasing
and transnational corporations, has opted for a
presence in Cabo Delgado. French-licensed helicopter
GAZ IN MOZAMBIQUE A WINDFALL FOR THE INDUSTRY, A CURSE FOR THE COUNTRY 3gunships operated by South African mercenaries Climate Convention that France’s desire was to help
even injured six children during a counter-insurgent Mozambique avoid becoming dependent on gas. In
attack in late May 2020. In the meantime, French complete contradiction to his words, his country
banks continue to claim to work only with operators is pushing Mozambique into that same trap of gas
that uphold human rights and that the agreements to dependence, in the name of the economic interests
protect the gas infrastructures help to protect local of French energy industrials and bankers. And as fate
communities. These claims are totally hollow. would have it, Mozambique is on the front line of
climate change impacts, being ranked as one of the
Mozambique is descending into the chaos of most vulnerable countries and having been hit by
the ‘resource curse’ with help from the French two devastating cyclones just over a year ago. Energy
government and French multinationals. The gas boom sovereignty for the peoples of Mozambique is critical,
has come with increased conflict, violence, corruption and can be achieved only through people-based,
and social inequality, a continuation of the evils that renewable energy solutions, not through fossil fuels
fossil fuels have provoked in so many other countries, which serve only corporate profits.
especially in Africa. The major gas companies are in a
position of power and can set the rules and grab the To end the hypocrisy, the French government must
profits. They have circumvented the already weak laws cease this diplomacy of chaos, practiced in the
on ‘local content’ designed to enable wealth creation interest of the fossil fuel and arms industries. Now
in Mozambique, laws which are apparently of little is the time for the French government to implement
concern to the Mozambique government. social distancing from fossil fuel industry lobbies.
First, they must stop providing export aid to projects
Detonating a climate bomb: such as this one, which are not only ticking climate
French government hypocrisy bombs but also lead to human rights violations. This is
the second scandal uncovered in two years involving
Not only does the gas boom spell chaos for
foreign gas projects guaranteed by the French
Mozambique, French machinations are forcing
government. After the Total facility in Yemen was
yet another African country into dependency on
found to be housing a secret prison, now it is the gas
fossil fuels, which climate science tells us must not
projects in Mozambique causing disastrous damage.
be exploited at all. The three gas projects under
It is time for the government and parliamentarians to
development could release as much as the equivalent
take stock of the climate emergency and the human
of seven times France’s annual greenhouse gas
rights and environmental violations associated with
emissions, and 49 times Mozambique’s current national
the projects they support, and change the law this
annual emissions. This is a ticking climate bomb ready
year to cease all subsidies to the oil and gas sector
to explode and will contribute to pushing the world
from 2021 onwards. French companies, including
even further towards the irreversible climate crisis.
private banks and energy companies like Total, must
immediately put an end to their involvement in gas
Yet these projects represent only part of the fossil
projects in Mozambique, or risk being found liable for
fuel reserves discovered. In January of 2020, French
breaching the French duty of vigilance law.
President Emmanuel Macron told the Citizen’s
GAZ IN MOZAMBIQUE A WINDFALL FOR THE INDUSTRY, A CURSE FOR THE COUNTRY 4TIMELINE
FRENCH ECONOMIC WEAPONS SALES & ENVIRONNEMENTAL AND CORRUPTION
INTERESTS MILITARY COOPERATION SOCIAL IMPACT SCANDAL
2010 to 2013 2015 2017
Huge gas reserves were July June
discovered in Mozambican Former Defence An auditor’s report
territorial waters north of the Minister, Filipe Nyusi, freshly confirmed that funds were
country. The French companies elected President of Mozambique, misappropriated and that the
Technip and Schlumberger were chose France for his first diplomatic financial set up of the loan was
involved in the exploration. trip outside of Africa. No press chiefly designed to fund a defence
conference was held between programme in connection with the
the two heads of State, so as to offshore gas and oil industry, where
2012 avoid bringing up the question the Mozambican government had
of the naval contract, at a time promised to make repayments with
September
when suspicions of corruption income from the gas industry.
Total established itself
over the deal were increasing in
in the Rovuma Basin, off the coast
Mozambique. However, discrete The final investment decision
of Mozambique, by buying shares
lunches took place with Emmanuel was taken for Coral South
in oil blocks.
Macron, then Minister for FLNG, the first gas project planned
the Economy and with French off the coast of Cabo Delgado
business leaders. province. The project was partly
2013 financed by Crédit Agricole, also
September October acting as the project’s financial
A public fishing company French government advisor along with other French
in Mozambique bought 30 ships representatives in the Mozambique banks BNP Paribas, Société
from Iskandar Safa’s Cherbourg Channel visited Maputo. Among Générale and Natixis.
shipyards (CMN), in a contract them was a military commander
much celebrated by the French who had come to assist the October
government. Mozambican navy, following The first attack by a group of
the purchase of naval vessels insurgents, which the government
The Mozambican from France. said was known as Ahlu Sunna
Deputy Minister for Wa-Jama, in Cabo Delgado. The
Foreign Affairs announced that first attacks came at the same
the six oil tankers in the 30-ship 2016 time as the financial formalisation
“fishing” fleet should be armed of the first gas projects, which
April
and that negotiations had begun exacerbated the social, religious,
The “tuna bonds” scandal
with France. The same year, ethnic and political tensions, at the
erupted. The Mozambique
France exported 12.3 million heart of the degenerating conflict.
government had contracted
euros in military equipment
hidden debts, in the form of State
to Mozambique. 4th quarter of 2017
backed loans, with the collusion
The French government
of Iskandar Safa’s company.
provided over half a billion euros
The banks that organised the
2014 transaction, including BNP Paribas,
in financial support to the oil
company TechnipFMC for work
June Credit Suisse and VTB Bank
as a contractor for the first gas
France reopened its International, froze financing,
project Coral South FLNG.
economic service at the French throwing the country into
embassy in Mozambique. economic and financial crisis.
December
The French Minister for Foreign
Erik Prince, founder of
Trade visited Pemba, near the
the notorious private security firm
gas reserves, accompanied by
Blackwater, created a company in
a delegation of industry heads,
Mozambique and acquired military
including those in oil and gas.
vessels from CMN, used to provide
security for the gas facilities.
GAZ IN MOZAMBIQUE A WINDFALL FOR THE INDUSTRY, A CURSE FOR THE COUNTRY 518 days prior to the presidential Ibrahimo Abu Mbaruco has been
2018
elections in Mozambique, enabling missing since 7 April, after soldiers
November Nyusi to announce to the media surrounded his home.
Potential gas revenue was that the country had received
at the heart of the Mozambique 880 million dollars in government French-licensed combat
government’s debt restructuring revenue. helicopters start being used
negotiations with its creditors. by South African mercenaries from
Gas exports have become the only the private military company
way to repay the public debt that 2020 Dyck Advisory Group (DAG)
skyrocketed following the scandal. to fight the insurrection.
January
Emmanuel Macron stated before
With the drop in petrol
2019 the Citizen’s Climate Convention
prices, the final investment
that France must help Mozambique
January decision for the Rovuma LNG
to avoid becoming dependent
An attack took place in project was pushed back.
on fossil fuels: “The problem we
Maganja, just 7km from the Afungi Crédit Agricole remains the
are going to face collectively, is
gas site. Mozambican soldiers financial advisor for the project
explaining to poor countries where
did not intervene, arguing that development.
deposits are discovered, that we
their orders were to protect the need to do without fossil fuels.
gas facilities only. Milamba locals May
[...] For example, Mozambique,
living near Maganja fled to Palma. Total’s gas site became
which has discovered rich deposits
During the time they were absent, the epicentre for the spread
in its waters. The country is
a subcontractor for the major gas of Covid-19 in Mozambique.
now exploiting these deposits,
companies took the opportunity sometimes with French operators.
to grab their lands and begin During the Battle
[...] Compensations must be found
construction works on of Macomia, six children
in the international economy
an aerodrome. were wounded by DAG helicopter
to help them withdraw and make
gunships. These are the first civilian
them less dependent.”
February casualties directly related to the
Anadarko (then operator involvement of private military
February
of Mozambique LNG, replaced a companies in Cabo Delgado,
French Minister for
few months later by Total) and and probably not the last.
Foreign Affairs, Jean-Yves le Drian,
ENI/ExxonMobil signed an carried out a diplomatic mission
agreement with the Mozambican June
to Mozambique to defend French
Defence Minister for paying the The signing ceremony for
fossil fuel industry interests, both
government to deploy more the closing of the 24 billion dollar
through finance and security.
troops to protect their facilities. financing for Total’s Mozambique
With the civilian death-toll rising,
The money was paid into a special LNG mega project is expected
Total and ExxonMobil asked
account, arousing suspicions. to take place. The French banks
the Mozambique government
Crédit Agricole and Société
to deploy 300 extra soldiers
March / April Générale, also a financial advisor,
around their facilities.
Tropical cyclones Kenneth will provide loans.
and Idaï devastated parts of March
Mozambique. They were the most French private security
violent cyclones ever to hit October
company Amarante Internationale
Cabo Delgado province. Business France
opened a branch in Maputo and
(a government agency for
responded to the call for tenders
August economic diplomacy) is organising
launched by Total to secure their
Combat helicopters still a networking event, called “French
gas facilities.
covered in French army camouflage Gas Days”, in Maputo to help
were seen in Pemba, operated French companies secure shares
April
by South African paramilitary in markets directly linked
According to the NGO
groups. to the gas boom.
ACLED, the insurrection has killed
1,100 people in Cabo Delgado since
September October 2017. Over 100,000 people
Total became the main have been displaced. Those who try
operator of Mozambique LNG, to raise awareness of the situation
buying out Anadarko’s Africa assets. are intimidated or kidnapped by
The transaction was completed government forces. Journalist
GAZ IN MOZAMBIQUE A WINDFALL FOR THE INDUSTRY, A CURSE FOR THE COUNTRY 6GAs IN
Report released in June 2020 by Les Amis de la Terre France,
Justiça Ambiental (JA!/Friends of the Earth Mozambique)
and Friends of the Earth International.
WRITING Cécile Marchand (Les Amis de la Terre France)
EDITING Catherine Mollière, Lorette Philippot, Juliette Renaud,
MOZAMBIQUE
Marion Cubizolles (Les Amis de la Terre France), Dipti Bhatnagar,
Sara Shaw, Madeleine Race (Friends of the Earth International),
Anabela Lemos, Ilham Rawoot, Daniel Ribeiro (JA!/Friends of the
Earth Mozambique), Tony Fortin (L’Observatoire des Armements).
A WINDFALL FOR THE INDUSTRY, LAYOUT Zelda Mauger PHOTO Daniel Ribeiro, JA!; Ike Teuling,
A CURSE FOR THE COUNTRY Milieudefensie; Christophe Sales
Friends of the Earth The federation of Friends of Justiça Ambiental (JA !) /
International is the world’s the Earth France is a non-profit Friends of the Earth
largest grassroots environmental environmental and human rights Mozambique is a leading
network with 73 member groups network, independent from any Mozambican non-profit
and over two million members religious or political influence. organization working to reduce
and supporters around the Created in 1970, they helped the environmental and social
world. Our vision is of a peaceful build the French ecological impacts of Mozambique’s
and sustainable world based on movement and helped found unsustainable development,
societies living in harmony with the world’s largest grassroots and trying to create new
nature. We envision a society of environmental network, Friends sustainable systems. We aim to
interdependent people living in of the Earth International. build awareness and solidarity
dignity, wholeness and fulfilment Friends of the Earth France in vulnerable grassroots
in which equity and human and forms a local network gathering communities and support
peoples’ rights are realised. 30 autonomous local and communities and civil society
This will be a society built associated groups that act by providing strategic and
upon peoples’ sovereignty and according to their own priorities technical advice, research,
participation. It will be founded and support the national and information, capacity-building,
on social, economic, gender international campaigns with and movement-building. We
and environmental justice a shared vision for social and seek to build the community
and be free from all forms of environmental justice.Friends voice by facilitating links
domination and exploitation, of the Earth France promotes between communities
such as neoliberalism, corporate solutions at the local, national facing similar environmental
globalisation, neo-colonialism and international level that will situations, supporting
and militarism. We believe that help to create environmentally community campaigns including
our children’s future will be sustainable and socially just understanding their human
better because of what we do. societies. rights, land rights and the
Constitution, providing access
to government and decision-
foei.org amisdelaterre.org
makers, access to media and
by internationalizing local
community struggles. We are
committed to a better, safer
and healthier environment for
Mozambique, for the world
and for current and future
generations.
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