Mozambique - Country Commercial Guide
Oil & Gas

This is a best prospect industry sector for this country.  Includes a market overview and trade data.

Last published date: 2022-11-30


Although development of onshore LNG megaprojects has been delayed by insurgency in the north, over the coming decade Mozambique is expected to become a major liquified natural gas (LNG) exporter due to the discovery of over 180 trillion cubic feet (TCF) of natural gas reserves in the Rovuma basin in the north of the country. These discoveries are spread over two concessions. The U.S. Export-Import Bank has committed to loaning $4.7 billion of the $24 billion investment into the Area 1 Mozambique LNG project led by TotalEnergies, while the Development Finance Corporation has extended $1.5 billion in sovereign risk insurance to Exxon Mobil’s Area 4 Rovuma LNG project, together representing the U.S. Government’s largest investments on the continent. 

TotalEnergies’ Area 1 project plans to build up to six LNG trains. The first two trains reached final investment decision (FID) in 2019 and are valued at $23 billion. Total selected a joint venture of contractors led by Saipem and McDermott to construct the facilities, including dedicated airstrip and port facilities located in the Afungi LNG Park. This project is targeting exports destined for Asian and European markets as well as over 400 MMCF reserved for domestic uses. In March 2021, Total stopped work on the project and declared force majeure to cancel its contracts for this project due to ongoing Islamic terrorist attacks close to the project site.  It has recently signaled it will not restart the projects until at least 2023.

The second concession, named Area 4 or (Rovuma LNG), is co-led by Eni and ExxonMobil, where Eni leads all upstream operations, and ExxonMobil leads the construction and operation of LNG facilities onshore located in the Afungi LNG Park. The engineering procurement and construction (EPC) contract was awarded to a consortium composed of TechnipFMC, JGC and Samsung Heavy Industries. Area 4 also has plans to develop two onshore LNG trains, but the timeline for an FID remains uncertain. In 2017, Eni announced the FID for $8 billion for the construction of six subsea wells connected to a Floating LNG (FLNG) production facility that is now on track for gas exports in Q4 2022.

Mozambique’s current natural gas production is operated by Sasol (South Africa) in Inhambane Province, which holds proven reserves of 2.6 TCF.  In August 2022, Sasol reported that it is working on future gas supply options, including the possible integration of imported liquefied natural gas (LNG) through Maputo, in Mozambique. It has already been able to extend the gas supply “plateau” from Mozambique by two years to 2028, following infill well drilling.

 The natural gas is produced and processed at a central facility in Temane and then exported via an 865 km pipeline to South Africa, with a link to southern Mozambique for domestic use. Additionally, Sasol is developing an integrated oil and liquefied petroleum gas project adjacent to its existing petroleum facility, this project is valued at over $700 million. The project includes 13 wells and a liquid propane gas (LPG) production facility at an estimated cost of $1.4 billion.

All exploration concessions are assigned by the National Petroleum Institute (Instituto Nacional de Petróleo; INP) through public tenders. Production contracts can then be negotiated once petroleum reserves are discovered.

In 2018, INP has signed concession contracts for petroleum exploration and production in offshore blocks in the Angoche and Zambezi Basins and onshore blocks in the Mozambique Basin to four consortiums led by ExxonMobil, Sasol, ENI, and Buzi. As of July 2021, none of these operators had started exploration or production activities in these blocks.

A Empresa Nacional de Hidrocarbonetos (ENH), the state-owned hydrocarbon company, represents the Mozambican Government in petroleum operations. The law stipulates that ENH participate as a stakeholder in petroleum production operations, as well as exploration projects. ENH is also engaged in other national flagship projects, such as the oil and gas terminal expansion in the Port of Pemba, and the urbanization of the district of Palma, where the Area 1 and 4 natural gas business activities will be concentrated. In partnership with Korean gas company Kogas, ENH also operates a gas distribution network to provide households and industry with piped gas into the south of Mozambique.

The Government of Mozambique has determined that a portion of natural gas production should be used locally to address the needs of the domestic market. The National Petroleum Institute (INP), which regulates the industry, organizes tenders to identify companies interested in developing industrial projects. U.S. Companies should expect to see new tenders for domestic gas projects coming out in the next year.

Leading Sub-Sectors

  • Engineering and steel structure fabrication services
  • Oil & gas machinery and services
  • Oil & gas drilling machinery and equipment
  • Maritime security equipment and services
  • Safety and security equipment and services


For the next five years, opportunities for U.S. equipment suppliers will be driven by the construction of Total’s LNG plant, ENI’s FLNG plant, and ExxonMobil’s LNG plant. The LNG development plan includes two 180,000 cubic meter LNG storage tanks, condensate storage, a multi-berth marine jetty, and associated utilities and infrastructure. . ExxonMobil’s development plan includes the construction of two liquefied natural gas trains which will each have the capacity to produce 7.6 million tons of LNG per year and related facilities. All three of the these project have an onshore base in the Afungi Park, hosting all the supporting infrastructure including accommodation facilities, port and airport infrastructure, as well as specialised tax and work visa regimes.

Companies should also track potential domestic gas project tenders from the Mozambican government, which could be major opportunities for midstream and downstream project developers.