As energy insecurity looms over the EU, Brussels turns its attention to Africa and, in particular, to Mozambique

Ukraine war and European energy insecurity: a benefit for Mozambique's gas exports to the EU?

With Russia's energy supply to the EU increasingly at risk of being cut off, Brussels is looking at all possibilities for sourcing energy resources from around the world. In Africa, Mozambique is attracting EU attention. In fact, in 2012, liquefied natural gas (LNG) resources were discovered off Mozambique's northern coast in the Cabo Delgado region, prompting the government to invest almost $20 million to exploit this resource. Project planning is already underway and LNG supply is expected in early 2024. This large resource is a boon for the EU, as Europe has stopped receiving Russian gas and has committed to finding cheaper alternatives to US gas. Mozambique is now a credible alternative for the EU to consider as part of its strategy to diversify its energy suppliers.
 
On 5 July, Italian President Sergio Mattarella travelled to Mozambique to meet with his counterpart, Filipe Nyusi, to negotiate the exploitation and supply of Mozambican gas to Italy. The large gas reserves available in Mozambique led the new EU ambassador to the country, Antonino Maggiore, to state that "with the amount of gas that exists, Mozambique is automatically positioned as an alternative to meet the needs that currently exist and the sooner the country can put its gas on the market, the greater the possibility of taking advantage of the current crisis caused by the Russian-Ukrainian conflict".

sergio mattarella presidente italia mozambique

Although Mozambique already has its first LNG liquefaction platform - called Corel-Sul - with an annual production capacity of almost 3.5 million tonnes, it was suspended last March following a jihadist attack in the north-east of the country. This led French flagship TotalEnergies to put its 16.5 billion euro project on hold. Now the area seems safer, favourable to the resumption of economic activities. During a press conference last week, the Minister of Mineral Resources and Energy, Carlos Zacarias, did not fail to recall his wish for operations to resume quickly because "the security situation in the area where the TotalEnergies and ExxonMobil projects will be implemented has improved a lot". In an interview in Maputo, Antonio Sánchez-Benedito Gaspar said that "Mozambique's gas, with the presence of large European multinationals, now has an even greater and more strategic value".

Mozambique also wishes to harness this natural resource for further economic and social development and is very open to this new partnership between the country and the EU. Mozambique's state-owned National Hydrocarbon Company (ENH) has expressed its willingness to help the EU 'especially because of the uncertainty of Russian supplies following the invasion of Ukraine', said its head. 
 
To address the EU's energy deficit, Mozambique is considering launching the construction of a second floating platform based on the existing one. However, this project is a medium-term vision, as the construction time is estimated at three years. Nevertheless, with the progressive exploitation of natural gas in the region, Mozambique could be an important African energy partner for the EU within a few years. A publication on African markets states that "there is no doubt that there is great potential in Africa to supply gas to Europe. However, it is very limited in the short term, mainly because gas projects take time to materialise, but in the medium to long term it is possible that Africa, especially Mozambique, could meet all of Europe's gas needs"

AFP/ ERIC PIERMONT  -   La petrolera Total se retira de Mozambique por la amenaza yihadista

The only obstacle to the start of work is the security factor, which has not yet been fully resolved, but when it is, the project should create 5,000 jobs for Mozambicans - during the construction phase - and another 1,200 in the operational phase, as well as the mobilisation of 2,500 technicians for the development of the training plan. Minister Zacarias also pointed out that these construction projects are a boost to employment: "These projects also have a great capacity to create indirect jobs, as foreign labour decreases throughout the project and Mozambican labour increases. Most of these jobs are expected to be provided by contractors and subcontractors," he said. 
 
In addition, in order to meet the demand for skilled labour for extractive industry projects in the country, the director of the National Petroleum Institute (INP) envisages the development of a human resources framework that is able to meet market demands in order to address the gap between investment in the industry and its capacity to create jobs. 
 
The stabilisation of long-term security in the north of the country is now the key to unlocking the country's economic activities and initiating a possible cooperation project between Mozambique and the EU.

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