MEGA-PROJECT: One of the most prominent projects lined up is the expansion of the Cahora Bassa Dam. Picture: Reuters

Mozambique is on the threshold of becoming a continental energy powerhouse as its multi-billion dollar projects reach incubation stage. This is the culmination of the government prioritising energy as a key driver of the economy.

Major energy projects in hydroelectricity, coal, solar, oil and gas, valued at $10 billion, are under way, while other energy projects have been completed.

Mozambique has started building a natural gas-fired power plant worth $1.2bn aimed at boosting the country’s energy supply at subsidised prices.

One of the most prominent projects lined up is the expansion of the Cahora Bassa Dam on the Zambezi. This presents a massive potential to increase energy production by about 3 600MW.

More than $7bn has been invested in the project.

The region, including South Africa, which has been the main source of energy for power-starved southern Africa, is poised to benefit from the hydropower project.

Mozambique Energy and Mines Minister Pedro Conceição Couto also assured that while such projects would end the country’s power challenges, his country would be able to export more to neighbouring countries, generating much-needed foreign currency.

Power utility Eskom, of South Africa, which is battling to satisfy internal demand, recently hinted at importing more power from Mozambique from its 1 500MW.

Eskom’s business development manager for the company’s Southern Africa Transmission Group, Willem Theron, confirmed that the utility had planned to import 6 250MW of power to two new coal-fired plants – Medupi and Kusile. The bulk of the power would come from Cahora Bassa Dam.

“It is assumed that some of the power can be through imports,” Theron told stakeholders in the coal mining industry at a meeting in the Mozambican capital, Maputo.

Apart from the expansion of the Cahora Bassa facility, Mozambique has embarked on the construction of five new hydroelectric dams to increase the country’s energy production by about 3 600MW.

Other dam projects initiated comprise the Lupata hydroelectric facility in Tete province, with a potential to generate 416MW at a cost of about $1bn, the 210MW Boroma hydroelectric dam at a cost of about $572.5 million, and the Mphanda Nkuwa Dam.

Apart from creating more than 4 000 jobs, the projects located 61km south-east of the Cahora Bassa Dam have the potential to generate 1 500MW, which has an estimated cost of $4.2bn.

In addition to abundant sources of hydroelectric power and gas reserves, Mozambique is teeming with coalfields at Minas Moatize and Ncondezi.

Through such resources, the country is set to generate an extra 700MW for local consumption while the other reserves will be exported to South Africa, Malawi, Zambia and Zimbabwe.

Some of the new coal power plants will take off before the end of this year while others are projected to start operating in 2018.

On the oil and gas front, the resources are equally enormous.

Recently, Engen successfully launched its Beira Terminal, which is poised to strategically boost the energy supply chain in the entire Southern African Development Community (SADC) region.

Following the launch in September, Engen has significantly increased its supply to a number of countries in the sub-region.

The new Beira Terminal is in full operation and supplying petrol, diesel and lubricants to the main hubs in Mozambique, as well as to other countries in southern Africa.

Outside the SADC, Engen has operations in Burundi, Gabon, Ghana, Rwanda and Réunion.

“We’ve tested railway capabilities from Beira to Bulawayo in Zimbabwe and to Francistown in Botswana, which was successful.

“This means that we can take some pressure off of our Durban refinery and supply Botswana and Zimbabwe directly from our new depot,” said Drikus Kotze, general manager of Engen’s international business division.

He said the investment reaffirmed Engen’s strong commitment to the Mozambican market and the African continent.

“Where others have disinvested in search of more profitable opportunities elsewhere, Engen has invested extensively in these regions, supplying infrastructure, harnessing local skills and business partnerships, and giving back to the communities,” he said.

During his Mozambican counterpart’s official visit to South Africa in October, President Jacob Zuma said the new energy generation projects would yield socio-economic benefits for South Africa and Mozambique.

“We urge our private sector to invest in each other’s territory and help create job opportunities,” he said after a meeting with President Filipe Nyusi. – CAJ News