French energy giant Total has suspended operations at a site exploring a major gas field in northern Mozambique weeks after Islamist militants attacked a nearby town.
The company said that it was withdrawing all its staff because of the “evolving” security situation.
Dozens of people were killed in the March raid on the town of Palma.
Total’s $20bn (£14.6bn) gas liquification plant is the largest foreign investment in Africa.
Its Afungi site is near Palma which has been repeatedly attacked by militants linked to the Islamic State (IS) group.
During the 24 March attack, dozens of foreign contract workers and local people were besieged at the Amarula Palma Hotel.
The UN’s World Food Programme said last week that the March attack had caused tens of thousands to flee the area – adding to a growing humanitarian crisis.
The agency says many lack proper shelter, and malnutrition among children is on the rise.
The four-year insurgency in Cabo Delgado region has left more than 2,500 people dead and 700,000 displaced.
Mozambique’s President Felipe Nyusi has promised to restore peace in the restive Cabo Delgado province.
On Monday Total said it “expresses its solidarity” with the government and called on the authorities to restore security.
The halting of Liquefied Natural Gas (LNG) exploration is a big blow to Mozambique, analysts say.
Insecurity in the region has also affected local traders – the country’s main business association said small- and medium-sized firms had lost $90 (£64m).
Hopes of transforming Mozambique’s economy under threat
By Catherine Byaruhanga, BBC News Africa correspondent
The authorities in Mozambique will breathe a huge sigh of relief that Total has not pulled out completely but this latest development is a sobering warning of how a key investment could be delayed or lost.
It comes weeks after the company resumed exploration activities after the government said its forces were in control of Palma close to its Afungi site. The guarantee didn’t last – only hours later the militants overran the town.
As well as Total’s LNG project in Cabo Delgado, there is another operated by the US’ ExxonMobil estimated to be worth $60bn. The fields could earn the southern African country some $100bn over the next 25 years – six times the country’s current budget and perhaps enough to transform its economy.
President Nyusi is under pressure to prove that he can secure the interests of international investors, keep Mozambicans safe, and reassure jittery neighbours that he can end the insurgency.
Who are the insurgents?
They are primarily Muslims from the coastal zone of Cabo Delgado, recruited by local fundamentalist preachers with a socialist message – that Sharia, or Islamic law, would bring equality and everyone would share in the coming resource wealth, according to Mozambique analyst Joseph Hanlon.
The first attack in the region was in 2017 on Mocimboa da Praia, the only city and port in this northern zone.
The preachers’ message and the promise of jobs and money led many young men to join the insurgency, and it gained support in local communities, he added.
The consensus is that the insurgency started locally and that foreign and IS involvement came later. The disagreement is over how important that is, said Dr Hanlon.