Erik Prince’s FSG Quits Mozambique Oil and Gas Logistics JV
Erik Prince’s FSG Quits Mozambique Oil and Gas Logistics Venture
Frontier Services Group Ltd., the Hong Kong-based company founded by Erik Prince, has decided to quit a logistics joint venture with Mozambique’s national oil company, even as the country gets ready to receive about $60 billion of investments in natural gas export projects.
The Chinese majority shareholders in FSG decided to withdraw from the partnership that was called ENHL - Frontier Service Group Lda., Omar Mitha, chairman of Mozambique’s state-owned Empresa Nacional de Hidrocarbonetos EP, told reporters Tuesday in Maputo, the capital. FSG is yet to formally communicate the decision, he said. The company declined to comment.
“The partnership no longer exists but it was their decision,” Mitha said. “They’re are no longer interested in the business. We’re OK with that.”
Prince, who founded and sold the private military company Blackwater Worldwide, which won hundreds of millions of dollars in contracts from the U.S. government during the Iraq and Afghanistan wars, also had a fishing joint venture with a Mozambican state-owned company, which has faced delays. Before FSG’s involvement, the tuna boats had been at the center of a $2 billion sovereign debt scandal that led to Mozambique defaulting in early 2017.
The boats had been largely idle in Maputo port since 2014. The joint venture, known as Tunamar, had planned to start fishing in March this year, but this was delayed, and it’s not clear if any of the vessels are active yet. FSG finalized the acquisition of its 49% stake in Tunamar in the fourth quarter of 2018, David Whittingham, vice president at FSG, said by phone in February.
Gas Investments
Prince, a minority shareholder in FSG and an executive director, also planned on providing security services in the southeast African nation, he told reporters in 2017. Companies including Exxon Mobil Corp. plan on investing about $60 billion in massive offshore natural gas resources discovered nearly a decade ago off Mozambique’s northern coastline.
FSG in July this year registered a security services company called FSG Mozambique Segurança Lda. in the country, with Lucílio Matsinha as a 51% shareholder, according to the government gazette.
It also registered another company in Mozambique called Blue-Fin Lda., according to the September government gazette. Blue-Fin’s planned business includes logistics and security, it said.
To contact the reporters on this story: Matthew Hill in Maputo at mhill58@bloomberg.net;Borges Nhamire in Maputo at bnhamire@bloomberg.net
To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net, Gordon Bell, Karl Maier
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