The EU is hunting alternative sources of energy since Moscow's invasion of Ukraine and Mozambique has the third largest proven gas reserves in Africa.

But the southern African country has been grappling with militants linked to Islamic State in its northernmost gas-rich province of Cabo Delgado since 2017. The conflict is near liquefied natural gas (LNG) projects worth billions of dollars developed by Western firms, including France's Total and Italy's ENI.

Confirming a Reuters report in August, the EU said governments agreed to give 15 million euros ($15 million) to the Southern African Development Community (SADC) mission to Mozambique (SAMIM), which is fighting the insurgency.

In an internal report seen by Reuters, the EU had warned of a "very volatile" situation in north Mozambique despite the SADC mission and a separate intervention by troops from Rwanda managing to contain the militants.

The financial support was announced a day after Mozambique said that at least six people were beheaded and an Italian nun killed by insurgents in northern Nampula province.

The funds come in addition to 1.9 million euros already provided by the EU to SAMIM and 89 million euros for the Mozambican armed forces.

The additional funds will be used to acquire camp fortifications and storage containers, medical equipment, vehicles and boats, as well as technological devices, the EU statement said.

In its internal report, the EU had said support would be limited to non-lethal equipment despite SADC's need for such..

The report said that EU support for the Rwandan mission in Mozambique would also be proposed in coming months.

($1 = 1.0004 euros)

(Reporting by Francesco Guarascio; editing by David Evans and Andrew Cawthorne)

By Francesco Guarascio