The Great Gas Illusion: Tracing The Billions Behind Mozambique Gas Projects

A cross-border team of journalists partnered with Open Oil - a Berlin-based financial analysis firm - to carry out a months-long financial investigation project to uncover the real costs and revenues of the LNG project. Using a combination of data mining, highly technical financial analysis, and classic investigative journalism the team unveiled what lies behind the LNG agreements between the extractive companies and the Mozambican government.

The analysis, based on publicly available data, comes to a worrying conclusion: if oil prices remain at current average levels, revenues from the project will be little more than half of the $49.4 billion projected by the government for 2018 - dashing hopes of a gas-led economic transformation for Mozambique.

The investigation also discovered Mozambique's tax revenues from the gas project will be drastically reduced by the companies' use of special purpose vehicles in the United Arab Emirates, allowing them access to the double taxation treaty. This exemption alone would cost the country at least US$ 5 billion. This amount is enough to cover almost a third of Mozambique's current public debt and it is five times the amount of revenue the country's national oil company will receive over the life of the projects.

Photo image: LNG plant construction in Cabo Delgado

Photo credit: Borges Nhamirre