Oil & Gas sector in Mozambique

Oil & Gas sector in Mozambique

Mozambique’s oil & gas sector is expected to experience substantial development in the next years following the recent discoveries of important gas reserves in the Rovuma basin, near the border with Tanzania.

Market overview

The first discoveries of natural gas in Mozambique date back to the early sixties, but it was nearly 40 years later that Sasol began to develop the onshore Panda and Temane gas fields and construct an 865 km pipeline to their petrochemical plants in South Africa. The first production came on stream in 2004. Pande and Temane have proven reserves of 3.5 trillion cubic feet.

In July 2005 Mozambique’s National Petroleum Institute (INP) announced in London that it would be opening a competitive bidding round for exploration acreage focused on the Rovuma Basin in Northern Mozambique (onshore and offshore), extending from the port of Nacala to the border with Tanzania. In March 2006 the Government announced the results of the bidding, with exploration blocks awarded to Anadarko (USA), ENI (Italy), Artumas (Canada), Petronas (Malaysia), and Norsk Hydro (Norway).

In December 2006 a further Licensing Round was announced, again in London, for the Central and Northern Mozambique Basin, as a result of which Sasol Petroleum and OSHO Consortium were invited to commence final EPC license negotiations. A fourth competitive bidding began in November 2009, but only the application for the Lower Zambezi area from DNO of Norway met all the evaluation criteria. A bidding round for the Mozambican part of Lake Niassa (Lake Malawi) in 2010 was shelved, with the Government preferring first to ensure that the maritime border with Malawi was fully delineated.

Various farm outs and changes in ownership have followed.

The Mozambican Government has announced that 6 to 10 new exploration blocs will be opened for competitive bidding during the first quarter of 2013.

Recent Discoveries in the Rovuma Basin

In February 2010 Anadarko announced that its first “Windjammer” well in Offshore Area 1 had been successful. All of Anadarko’s subsequent 11 wells have reported positive results. In October 2011 ENI announced that its first exploration well in the Mamba South region of the adjoining Offshore Area 4 had discovered a “massive” gas play. ENI has drilled a further four successful wells in Area 4. Current estimates of recoverable reserves of gas for Areas 1 and 4 are 60-120 trillion cubic feet. There is the potential for Mozambique to become one of the largest exporters of LNG in the world.

Petronas of Malaysia started appraisal drilling in its Rovuma exploration blocs 3 and 6 in September 2012, and Norway’s Statoil will commence exploration activities in April 2013.

Anadarko has ambitious plans for an LNG plant (initially 2-train, each with 5 million tonnes pa capacity) to be in production by the end of 2018. The facility might subsequently be extended to 6, 8 or even 10 trains. Initial funding requirements may be in the region of $15-20 billion.

Anadarko recently announced that it has reached Heads of Agreement (HoA) with ENI to facilitate a work program whereby the two operators, will jointly plan and construct common onshore liquefaction facilities in the form of an LNG (liquefied natural gas) park while conducting separate, yet coordinated, offshore development activities.

In addition, multiple Front-End Engineering and Design (FEED) contracts have been awarded for both onshore LNG construction and offshore installation.

There is press speculation that one or more energy super-majors may enter Rovuma.

Key opportunities

  • New exploration blocs to be opened for competitive bidding during the first quarter of 2013

  • Pemba and Palma port development and management

  • Pipeline engineering and construction (both subsea and onshore)

  • LNG plant engineering and construction

  • Other gas monetization projects for local use (methanol, fertilizers, power generation, etc.)

  • Provision of specialized goods and services to the oil & gas industry (tubular goods, maintenance and repair services, drilling and well intervention services, logging services, etc.)

  • Other services and opportunities: aviation services, field support services, camp management, health services, security, temporary housing, etc.

Latest export opportunities – Oil & Gas

Latest export opportunities – Mozambique

Getting into the market

Special regime for the hiring of foreign personnel.

The short-term work regime for petroleum and mining sectors allows foreign citizens to perform occasional, unforeseeable and discrete jobs, for not longer than 180 days per year, consecutive or interspersed. This regime provides a solution for shift-job on the drilling ships where 28 days of consecutives work alternates with 28 days off.

Concessionaries have also been awarded a special quota of permanent expatriate workers. The Operators’ foreign subcontractors’ personnel is counted among the same quota.

Special fiscal regime for non-resident foreign Subcontractors.

The non-resident foreign Subcontractors of the Operator are subject to a withholding tax at the single flat rate of ten percent (10%) of the gross amount of the payments of its invoices in respect of the work or services they performed for the Operator.

Preferential Procurement Policy Regulations.

The Operator shall give preferential treatment to the purchase of local goods and services when such goods and services are internationally comparable in terms of quality, availability, quantity required, and are offered at prices inclusive of taxes not higher than ten percent of the available imported goods.

Inter-ministerial consultations have started to devise a local content strategy for the oil and gas sector that will see foreign firms having to partner with local ones.

More about doing business in Mozambique


Market intelligence is critical when doing business overseas, and UKTI can provide bespoke market research and support during overseas visits though our chargeable Overseas Market Introduction Service (OMIS).

To commission research or for general advice about the market, get in touch with our specialists in country – or contact your local international trade team.

Contact your local international trade team

UKTI Events

UKTI runs a range of events for exporters, including seminars in the UK, trade missions to overseas markets and support for attendance at overseas trade shows.

Latest events – Oil & Gas

Major Events

Mozambique Gas Summit

Maputo, Mozambique

12-14 March 2013


East Africa Oil & Gas Summit

London, UK

7-9 October 2012


Useful links

More about OMIS and other UKTI services for exporters

Sectors: Oil & Gas
Countries: Mozambique
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