At the Invest in African Energies: Mozambique Roundtable, MEC’s chairman spoke of an opportunity for local firms to increase their role in the market largely dominated by foreign players.

What: Florival Mucave emphasised the need for local businesses to expand their presence in the market at this critical moment of the oil and gas sector development.

Why: In previous licensing rounds, participation from Mozambican firms was limited owing to a lack of experience among local companies in the nascent industry.

What next: Global energy giants confirmed their commitments to socioeconomic investments in the country.

The Mozambique Energy Chamber (MEC) has called for greater involvement of local companies in the country’s oil and gas developments at an investment roundtable in Maputo.

The Invest in African Energies: Mozambique Roundtable, jointly organised by the African Energy Chamber (AEC) and the MEC, took place on February 13. Speaking at the event, MEC’s chairman Florival Mucave highlighted the opportunity for local firms to increase their role in the market largely dominated by foreign players.

According to Mucave, Mozambique’s substantial hydrocarbon reserves can be instrumental in eradicating poverty in one of the globe’s poorest economies. The southern African nation estimated in June 2024 that 65% of its 34 million people lived below the poverty line, up from 46% in 2014.

“We are confident that oil and gas will deliver significant benefits to our people,” Mucave said. “While we recognise the challenges posed by climate change and remain committed to addressing them, we cannot afford to sit on these vast resources and continue to struggle economically.”

Expanding local footprint

Mucave emphasised the need for local businesses to expand their presence in the market at this critical moment, the AEC said in a press statement on February 17. He noted that in past licensing rounds, participation from Mozambican firms was limited owing to the industry’s early-stage development and a lack of experience among local companies. However, he highlighted that ongoing projects and fresh investments now offer a chance for greater local involvement and faster industry growth.

Mozambique has up to 180 trillion cubic feet, or 5.1 trillion cubic metres, of recoverable gas, both offshore and on land. Major investors in the sector include TotalEnergies (France), Eni (Italy) and ExxonMobil (US). Eni has been liquefying gas and exporting it from an offshore LNG project since 2022. Larger projects operated by TotalEnergies and ExxonMobil are still at the development stage and awaiting financial investment decisions (FIDs), as recently reported by NewsBase.

Mucave pointed to these developments as significant opportunities for Mozambican companies to establish themselves within the sector.

“The industry is extremely capital-intensive. Large multinational players have dominated past licensing rounds because they possess the necessary capital and expertise. Now, it is time for Mozambicans to expand their footprint by collaborating with international partners to ensure meaningful participation,” he said.

Mucave urged the government to create an enabling environment for the private sector and boost local participation through inclusive policies and capacity-building programmes.

“Although Mozambique is rich in natural resources, that alone is not enough. To develop the industry and the country, we need to build our capabilities and acquire the necessary skills to actively participate,” he said.

Mucave underscored the MEC’s efforts to enhance local involvement, explaining that the chamber served as a hub for both international and local companies. In addition to supporting small businesses, its objective is to help them grow into small to medium enterprises (SMEs) that can operate within the sector, contribute to industry growth, and form partnerships that drive expansion.

International commitment

According to an earlier press release by the AEC, global energy giants confirmed their commitments to socioeconomic investments in the country at the Invest in African Energies: Mozambique Roundtable. ExxonMobil has invested over $20mn in Mozambique as part of its social investment strategy since 2017.

Speaking at the event, Armando Afonso, public and government affairs manager at ExxonMobil Mozambique, said the American supermajor planned to direct more investments in the local economy through upcoming projects. ExxonMobil is involved in Mozambique’s Rovuma LNG project to develop vast natural gas reserves in Area 4 of the Rovuma Basin, off the northern coast of the country.

ExxonMobil, alongside Eni and China’s CNPC, is part of the Mozambique Rovuma Venture (MRV), which holds a significant stake in Area 4. The company is responsible for leading the construction and operation of the onshore liquefaction facilities at Afungi in Cabo Delgado province.

The Rovuma LNG project has faced delays owing to security challenges in Cabo Delgado. Consequently, ExxonMobil has postponed the FID for the project to 2026. However, the company says it remains committed to this critical energy project, with production now anticipated by 2030.

Afonso stated that ExxonMobil’s commitment was driven by several key factors, including the extensive reserves in Area 4, Mozambique’s advantageous location with strategic market access, and the Rovuma LNG project’s low-emissions profile. He also pointed out the opportunity to incorporate renewable energy sources, such as solar, wind, and hydrogen production, into the Area 4 project.

“With the ramp-up of the Rovuma LNG project, our impact on local content will continue to grow, creating opportunities across the entire economy,” he stated. “Even though we are not yet in production, we have already positioned ourselves as a leader in local content with our Primary Centre training local SMEs and our supplier portal enabling local businesses to register and partner with us.”

Contributing to the discussion, exploration manager at Eni Mozambique, Valerio Parasiliti Parracello, noted that although the company currently operates only six wells at the Coral South project, there are substantial opportunities for future expansion.

“With Coral North and onshore projects, we see great potential to expand our portfolio and production in Mozambique,” he said.

Meanwhile, Christelle Demars, geoscience and reservoir manager for TotalEnergies’ Mozambique LNG Project, highlighted the exceptional quality of gas resources in the Rovuma Basin as a key factor driving the company’s interest.

“In just one area, we have 65 trillion cubic feet [1.8 trillion cubic metres] of gas, which will unlock enormous opportunities for Mozambique,” she stated. Demars also mentioned that, as part of its agreement with the government and its local content strategy, TotalEnergies will supply gas to the domestic market.

AEC support

The AEC says it supports Mozambique’s vision for increased role of local companies in its oil and gas sector development. AEC’s executive chairman NJ Ayuk encouraged Mozambique to resist negative perceptions of fossil fuels, arguing that while some critics condemn oil, they continue to benefit from it. He emphasised that the country should fully utilise its natural resources for its own development, without feeling the need to justify its actions.

“Mozambique’s energy story is still being written, and it must be written here in Mozambique,” Ayuk said. “We must get it right by prioritising local content, avoiding resource nationalisation and strengthening partnerships with both global and local companies - they are not our adversaries.”