Gas has made Mozambique a ‘relevant player’ in the international energy market

Mozambique President Filipe Nyusi told parliament on Wednesday that the country is already a “significant player” in the international energy market, having exported more than 60 cargoes of liquefied natural gas (LNG) since November 2022.

“Gas revenues have become a reality for Mozambique,” said the head of state, presenting for more than three and a half hours his annual report on the general situation in the country at the Assembly of the Republic in Maputo.

“We have already managed to export gas from the Rovuma basin to turn it into wealth. Rovuma gas can contribute to the country’s economy in the coming years. It is still on a small scale, but it can,” Nyusi said as he presented his annual balance sheet for the last time – usually prepared at the end of the year – ahead of the general elections on October 9, in which he is not running.

Mozambique’s president, in power since 2015, has suggested that natural gas and the revenues from its exports represent a “transformative chapter” in Mozambique’s “economic story” but is framed within a “long-term strategy”.

He also stressed that revenues from LNG exports should be used as a “development engine” for the country, citing as an example the launch of the Mozambique Sovereign Wealth Fund, which has been fueled by these resources since April.

In summing up the past five years, Nyusi called the “most significant milestone” the start of production and commercialization of LNG from Area 4 – the only one of the three projects already approved at the production stage – by Mozambique Rovuma Venture (MRV), a “joint venture” co-owned by ExxonMobil, Eni and CNPC (China), which holds a 70% stake in the concession contract, which is expected to double capacity in the coming years through a second floating platform.

“From November 2022 to June 2024, 63 deliveries were made, corresponding to 4.48 million tons of LNG. This feat symbolizes the realization of a long-standing dream and positions Mozambique as a significant player in the global energy market,” he said, although he reinforced the need to create “local value.”

“We are making sure that something remains inside. And remains for Mozambicans,” he said.

Mozambique has the third largest natural gas reserves in Africa and currently has three approved development projects to explore natural gas reserves in the Rovuma Basin, considered one of the largest in the world, off the coast of Cabo Delgado.

TotalEnergies, the leader of the Area 1 consortium, the largest of these projects, is currently developing the construction of a plant near Palma to produce and export natural gas, which has been suspended since 2021 due to terrorist attacks.

TotalEnergies President Patrick Pouyanné acknowledged in May “positive progress” in restarting the $20 billion (€18.3 billion) project, but did not give a time frame.

On July 25, presenting the results of the oil company’s work, Pouyanné said that “everything has been agreed with the contractors” for the resumption of construction, negotiations are underway with financiers and “progress” is recognized in the security situation.

“As you also know, presidential elections are coming soon. [09 de outubro] in Mozambique. And of course, it is important for us to have confirmation that the new President will pursue the same policy regarding these major projects. That is where we are. So I would say that by the end of the year we should have clarity on how we can move forward,” Pouyanné said.