Mozambique's gas-rich north faces specter of further attacks

By Borges Nhamire and Matthew Hill on 1/17/2018

MAPUTO and JOHANNESBURG (Bloomberg) -- Sporadic attacks by gunmen in northern Mozambique will probably continue although they’re unlikely to hurt investment in the region’s sizable gas resources, Control Risks Ltd. said, after seven people were killed in raids in the past week.

“The threat posed by the group is going to persist in coming months,” said Seamus Duggan, an analyst with the risk consultancy. Gunmen killed two people at a health center in Cabo Delgado province late Monday, two days after assailants opened fire on a government building and killed five in Palma, near where Eni SpA and Anadarko Petroleum Corp. have gas projects.

Police have arrested more than 300 people since the first significant attack on Oct. 5 in the nearby city of Macimboa da Praia, which the government blamed on a “radical Islamic sect.” Police haven’t said the latest attacks are linked to that group.

Eni in June signed off on the construction of its $7-billion Coral South gas project off Mozambique’s coast near Palma, while Anadarko has yet to make a final decision on its involvement as it seeks to lock in buyers for the bulk of its planned production first. The recent violence likely won’t affect decisions, as it’s unlikely the groups would be able to launch a sophisticated attack on gas facilities, Duggan said by phone.

Neither Eni nor Anadarko immediately responded to emails seeking comment. There’s no indication that the companies will be targeted, said Duggan.

The assailants’ ability to carry out any large-scale attack is doubtful “and thus far we’ve seen no intent from their side to do that,” he said. “The attacks so far will concern oil and gas companies, but they are unlikely to be viewed as a significant enough threat to prompt them to reconsider investments. The main impact will likely be a heightened concern around issues such as transporting personnel.”

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