Chronicle Editor
FOR many years Mozambique has been pursuing ambitions to become a global natural gas exporter.
The country has struggled to generate enough energy for its domestic market.
We are now about to see an energy revolution in Mozambique and parts of Africa, thanks to great gas discoveries made by international investors over the past decade.
The multi-billion Mozambique gas project is one of the biggest investments in Africa and raises the hope of catapulting the neighbouring country to middle income status by the mid-2030s.
From Senegal to South Africa, natural gas is taking an increasingly important place within the continent’s energy mix.
Africa is home to the world’s largest recent gas discoveries, especially in Senegal and Mozambique and governments across the continent are increasingly recognising the benefits of using African gas to drive economic growth.
Zimbabwe, is also angling to exploit its vast methane gas deposits in the Gwayi-Lupane area of Matabeleland North province but is yet to secure concrete investment.
Most of Africa’s gas have remained undeveloped or exported, and the potential to generate local value has remained underexploited, according to the African Energy Chamber.
While international technological innovation and skilful know-how will be driving such projects, we must all push for a transfer of knowledge throughout the development of Mozambique’s liquefied natural gas projects.
The need for more collaboration and shared experience among African energy experts is going to be critical for Mozambique and regional peers as they push towards monetising massive gas discoveries.
Developing small-scale natural gas infrastructure, supporting deals on gas-to-power, petrochemicals and fertilisers, and improving access to data on gas supply and demand on the continent, are equally critical.
Similarly, recognising that the state and the private sector need to play a role in the development of critical energy infrastructure to pave the way for domestic gas utilisation will be key to Mozambique’s development and also solving energy poverty issues.
“Mozambique can learn from the success and struggles of other African countries on the critical role of gas in our development,” says Florival Mucave, president of the Mozambique Oil and Gas Chamber, who firmly believes that increased collaboration between upstream and downstream players across the value-chain will benefit the country.
Mozambican stakeholders from the public and private sector recognize that the country is at a crossroad in its development.
In this context, building the right energy mix while taking into consideration climate issues is key for the country.
The African energy industry is capable of embracing climate concerns and at the same time continuing to develop its natural resources to benefit the poor, create jobs and promote an inclusive economic development. Mozambique’s LNG is important to the world and will act as a bridge to other sources of energy, and local businesses should be ready to participate in this development.
Local content and jobs must not be catch phrases, they must be real. African businesses and entrepreneurs have a role to play and must push for an enabling environment that will spur investment, entrepreneurship and growth.
“The government and energy companies have recognized the amazing opportunity that gas offers to change our economic ambitions, and there is a clear intent to monetise these resources for the benefit of Mozambicans,” Mucave added.
“This will be possible only through an increase in investment into infrastructure. The issues around domestic gas and local concerns will be resolved with a market driven approach.
“This will pave the way for the use of affordable and abundant gas to launch an industrial and agricultural-led growth, improve our trading abilities regionally, effectively increase the Mozambican spending power, and revitalise our economy in a post Covid-19 environment.” Mozambique is already benefiting from its collaboration with the
African Energy Chamber, the largest energy industry lobby group on the continent. Such collaborative platforms between the public and private sector needs to be encouraged to drive investment in gas and monetisation across industries, for the benefit of African factories and households.
“We stand ready to share lessons learnt from other gas producers with Mozambique. There are a lot of resources across our network when it comes to gas monetisation, including successful deals, in-depth industry experience and market driven policies that can ensure Mozambique’s energy success,” said NJ Ayuk, executive chairman of the African Energy Chamber.
“Mozambique is in a unique position to capitalise on these opportunities and I am confident it will. Our industry needs to collaborate with government to develop smart policies and drive up the economy.
“Total, Exxon, ENI are part of the solution and we must work with them and provide the incentives to collectives achieve such opportunities that benefit Africans as a whole,” he added. — African Energy Chamber/Business Chronicle
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