Cape Town — Mozambique is seeking investment from South African energy companies for a proposed $250 million natural gas project aimed at strengthening regional energy security and positioning the country as a major energy supplier in Southern Africa.
Mozambique's state-owned oil company, Empresa Nacional de Hidrocarbonetos (ENH), is holding discussions with potential investors, including South African energy and chemicals group Sasol and the Republic of Mozambique Pipeline Company (ROMPCO), according to ENH Chief Executive Officer and Chairman Rudencio Morais.
The proposed development comes as Mozambique looks to secure new markets for its substantial natural gas resources while helping address the region’s growing energy needs.
Proposed Infrastructure to Connect Mozambique and South Africa
The project, planned around the coastal areas of Beira and Inhassoro, is expected to cost approximately $250 million.
It would involve the development of floating storage and regasification units (FSRUs) at Inhassoro and the Port of Beira, alongside a new 140-kilometre pipeline connecting the facilities to the existing ROMPCO pipeline network.
The network transports natural gas from Mozambique to South Africa’s Secunda industrial complex, making it a critical component of cross-border energy trade between the two countries.
ENH aims to have the proposed infrastructure operational by 2030 or 2031, aligning its development with Mozambique’s wider liquefied natural gas expansion plans.
“We want our infrastructure by 2030 or 2031, in step with Mozambique LNG, Rovuma LNG and Coral North,” Morais told Reuters.
South Africa Seeks Alternative Gas Supplies
Mozambique has historically been a major supplier of natural gas to South Africa through Sasol's onshore Pande and Temane fields. However, these resources are expected to become depleted within the coming years, increasing the need to identify alternative supplies.
Mozambique's offshore Rovuma Basin contains substantial natural gas reserves that could help meet future demand in South Africa and other regional markets.
Sasol said it was too early to speculate on the nature or scale of any potential investment in the proposed project as the company continues exploring alternative gas supply options.
ROMPCO did not immediately respond to Reuters’ request for comment.
Mozambique Targets Regional Energy Hub Status
The proposed project forms part of Mozambique’s broader ambition to become a regional energy hub by expanding gas infrastructure, supporting cross-border trade and improving access to energy across Southern Africa.
International energy companies, including TotalEnergies, ExxonMobil and Eni, are developing major liquefied natural gas projects in the country, particularly around the resource-rich Rovuma Basin.
Much of the gas from these developments is intended for international markets. However, Mozambique has introduced new petroleum laws requiring at least 25% of oil and gas production, explicitly including liquefied natural gas, to be allocated to the domestic market.
The legislation, which took effect in June, is intended to strengthen domestic access to the country's petroleum resources.
“Mozambique is going to become what we call the power hub,” Morais said, highlighting the country's ambition to supply energy to a region grappling with electricity shortages.
Implications for Regional Energy Trade
If implemented as planned, the proposed infrastructure could help diversify gas supply routes, strengthen Mozambique–South Africa energy cooperation and create additional opportunities for investment in regional energy infrastructure.
The project also highlights the importance of developing transportation and processing facilities alongside large-scale gas production projects to ensure that natural resources can serve both domestic and regional markets.
However, the initiative remains at the investment discussions stage, and its eventual implementation will depend on securing financing, establishing commercial arrangements and advancing the necessary infrastructure.
As Mozambique continues developing its gas resources, the proposed project could become an important element of its efforts to expand its role in Southern Africa’s evolving energy market.
Source: Reuters
