The Islamic State group has claimed responsibility for an attack and siege that has lasted for days on Mozambique's coastal town of Palma.
"(IS) fighters have taken control of the strategically important town of Palma and killed more than 55 Mozambican security forces," IS claimed in a statement on its Amaq news agency.
Mozambique's defence ministry says at least seven people were killed during the attack which began on Wednesday, when about 100 insurgents stormed the gas-rich town in the volatile Cabo Delgado province.
Human Rights Watch (HRW) meanwhile said numerous residents have been killed in the insurgency while hundreds have fled the violence.
The deaths included at least one South African citizen and The Times newspaper reported that a UK citizen had died.
Mobile phone signals have been disrupted, making it harder to obtain information about the situation.
French energy giant Total relocated about 1000 of its workers from the region.
Total is leading a $US20 billion ($A26 billion) foreign investment project at its liquefied natural gas (LNG) plant on the nearby Afungi peninsula.
The project was halted in January due to ongoing insecurity and an escalating insurgency but Total recently announced it was about to relaunch the project.
The population in the oil-rich Cabo Delago province has been suffering from brutal attacks for the past three years in a simmering conflict that has cost an estimated 2500 lives to date.