The economic week in Mozambique was defined by fresh advances across the country's two principal natural gas megaprojects in the Rovuma Basin, with ExxonMobil selecting the consortium to lead the main construction works at Rovuma LNG and TotalEnergies announcing that Mozambique LNG has reached approximately 45% completion. On the public finances front, the government disclosed plans to disburse $780 million this year to service external debt, while the country's fuel import bill fell 1.4% in the first quarter.
ExxonMobil announced this week the selection of the consortium that will be responsible for the Engineering, Procurement and Construction (EPC) services for the onshore facilities of Rovuma LNG, one of the largest natural gas projects planned for Mozambique.
The US energy major, which serves as delegated operator of Area 4, issued a letter of intent to the SMDC consortium, comprising Saipem, McDermott Energy Solutions, Daewoo Engineering & Construction, and China Petroleum Engineering & Construction Corporation.
The award represents one of the final steps ahead of the Final Investment Decision (FID), expected later this year, enabling project partners to advance preparation and planning for the execution phase. "The selection of our EPC contractor for the onshore facilities is an important milestone in advancing the Rovuma LNG project," said Johanna Boothey, chairperson of ExxonMobil Mozambique's board of directors.
The onshore infrastructure will include 12 liquefaction modules with a combined capacity to produce 18.6 million tonnes of liquefied natural gas (LNG) per year. Commercial production is targeted for 2031.
This development follows ExxonMobil's decision in November 2025 to lift the force majeure declaration that had kept the project suspended due to the security situation in Cabo Delgado. In July, President Daniel Chapo expressed his expectation that the final investment decision would be taken by September, describing Rovuma LNG as one of the largest private investments planned for Africa.
The other major onshore gas project in the Rovuma Basin also recorded new progress this week. TotalEnergies announced that Mozambique LNG, being developed in Area 1, has reached approximately 45% completion, with 2029 maintained as the target for the start of production.
According to TotalEnergies chief executive Patrick Pouyanné, between seven thousand and eight thousand workers are currently engaged in construction works at Afungi, in Cabo Delgado province, following the official resumption of works in January this year. "When we compare with the progress curve, we are at almost 45% completion," he said during the presentation of TotalEnergies' second-quarter results.
The project faced logistical constraints stemming from the conflict in the Middle East, particularly difficulties in transporting equipment manufactured in Dubai and other facilities in the region. The company considers, however, that the main obstacles have been overcome and maintains its forecast for the first LNG train to come onstream in 2029.
Valued at approximately $20 billion, Mozambique LNG will have capacity to produce up to 13 million tonnes of LNG per year. The simultaneous progress of this project and ExxonMobil's Rovuma LNG reinforces the outlook for the expansion of Mozambique's natural gas industry. The Coral Sul FLNG, operated by Eni, currently remains the only major Rovuma Basin project in production, having commenced operations in 2022. The second floating platform, Coral Norte, valued at $7.2 billion, is expected to enter operation in 2028.
On the public finances front, the government plans to disburse approximately 50.3 billion meticais, equivalent to $780 million, to service external public debt throughout 2026.
Of this amount, $598.9 million is earmarked for principal repayments and $180.7 million for interest payments, according to the 2025 Annual Public Debt Report. The figure represents an increase from the $542.7 million disbursed in 2025, a year in which external debt service had itself fallen 39.03% compared with 2024.
The payment schedule is concentrated primarily in January, March, July, and September, with the first two months and the last representing the periods of greatest pressure on public finances. Projections from the Ministry of Finance point to a worsening of the debt burden from 2028 onwards, when Mozambique is expected to begin amortising the MOZAM 2032 international sovereign bond. Between 2028 and 2029, annual external debt service could reach approximately $932.1 million.
Despite the pressure anticipated in coming years, certain sustainability indicators recorded improvements in 2025. The ratio of the present value of debt to gross domestic product fell from 33.1% to 29.6%, while the weight of debt service on exports declined from 10.4% to 7%.
The week was also marked by the release of new data on fuel imports. According to the Bank of Mozambique, the country's fuel import bill fell 1.4% in the first quarter of 2026, settling at $236.4 million, compared with $239.6 million in the same period of the previous year.
Fuels absorbed almost half of the $517 million spent by the country on imports of intermediate goods between January and March. Diesel accounted for the largest share, at $164.9 million, followed by petrol at $56.4 million and aviation fuel at $15.2 million.
The decline in imports occurred, however, against a backdrop of difficulties in domestic supply and constraints on access to foreign exchange. After shortages recorded in April and May, fuel queues re-emerged this week at filling stations in Maputo and Matola, prompting the government to announce an investigation into the causes of the new scarcity. Around 80% of Mozambique's imported fuels originate in the Middle East and transit through the Strait of Hormuz, leaving the country particularly vulnerable to disruptions in international supply routes.
At the same time, the sector continues to exert significant pressure on the foreign exchange market. Data from the Bank of Mozambique show that foreign currency sales by banks to their clients increased by $356 million in the first half of the year, totalling $4.16 billion. Fuel import companies absorbed approximately half of the foreign exchange sold to the largest clients.
Source: Diário Económico
Original article: https://www.diarioeconomico.co.mz/?p=528424
