MAPUTO, May 10 (Reuters) - Mozambique's army is fighting

Islamist insurgents who launched a major attack on the northern

town of Macomia on Friday morning, President Filipe Nyusi said

in a televised address.

The town is in Cabo Delgado, a gas-rich northern province

where Islamic State-linked militants started an insurgency in

2017. Despite a large security response, there has been a surge

in attacks since January this year.

"Macomia is under attack since this morning. Fire exchange

still continues," he said at around 1000 GMT, adding that the

militants initially withdrew after about 45 minutes of fighting,

but then regrouped and came back.

Friday's attack appeared to be the most serious militant

attack in some time. Local media reported that a large number of

fighters were involved and many residents had fled.

A regional force from the Southern African Development

Community which deployed in Mozambique in 2021 started

withdrawing last month as its mandate ends in July.

Nyusi said that attacks can take place in such periods of

transition, and that he hoped the SADC forces would be able to

step in and help. It was unclear if they were still deployed in

the area or involved in the fight.

Rwanda has also deployed troops to Mozambique to help fight

the insurgency.

The offensive comes as French oil company TotalEnergies

is seeking to restart a $20 billion liquefied natural

gas terminal in Cabo Delgado that was halted in 2021 due to the

insurgency. That project is some 200 kilometres (124 miles)

north of Macomia, the town under attack.

ExxonMobil ( XOM ), with partner Eni, is also developing an LNG

project in northern Mozambique and said last week that it was

"optimistic and pushing forward" as the security situation had

improved.