By 2056, the Rovuma LNG project in Mozambique could become one of Africa’s most transformative undertakings, redefining the country’s economic, social, and development trajectory. With reserves exceeding 85 trillion cubic feet — and more than 100 trillion cubic feet at the national level — Mozambique is emerging as a strategically positioned gas economy. The project will generate three revenue streams: liquefied natural gas (LNG), accounting for approximately 93% of revenues; condensate, at around 4%; and domestic gas, at approximately 3%.
A macroeconomic study by Standard Bank, released in May 2026, projects that Rovuma LNG will add $11.4 billion annually to the economy — equivalent to 49% of 2024 GDP — when fully operational. Mozambique’s current GDP stands at $22.7 billion, with annual growth of between 3.3% and 4.1%. The projected 21% increase in average household income, combined with $4 billion in annual tax revenues, would give the government unprecedented fiscal space to invest in social sectors.
Mozambique’s Human Development Index, currently among the lowest in the world, is constrained by limited access to healthcare, education, and electricity. A total population of 36.9 million faces persistent challenges related to poverty, inequality, and inadequate infrastructure. Around 40% of the population aged 15 and above lacks basic literacy skills, with the female literacy rate standing at just 50.9%, compared with 74.1% among men.
With $30 billion in pre-production investment and an expected output of 18 million tonnes per year, Rovuma LNG is more than an industrial expansion — it could reconfigure the national economy. The project alone could expand the economy by more than half, lifting GDP to approximately $31 billion in the near term and, with sustained growth, significantly broadening the country’s economic base by 2056.
“The volatility of global LNG markets, the risk of excessive dependence on a single resource, and the governance demands associated with managing large revenues are all relevant factors.”
This could place Mozambique in a higher tier among middle-income economies, with LNG revenues supporting productive diversification into manufacturing, services, and infrastructure. The projected annual increase of $6 billion in gross national income suggests that Mozambicans could share in the benefits of this expansion.
A driver of economic and social transformation
The study estimates the creation of 151,064 direct, indirect, and induced jobs, including approximately 1,000 direct positions during the operational phase. While direct employment may appear modest, the indirect effects are considerably more significant. Construction, logistics, transport, and services will absorb tens of thousands of workers, while induced employment will have an impact on trade, agriculture, and small enterprises.
Mozambique’s Sovereign Wealth Fund is projected to reach $81 billion by 2056. This instrument could preserve revenues for future generations, reduce the risk of the so-called ‘resource curse’, and position the country among mid-sized sovereign investors. At that scale, Mozambique would be comparable to countries with established sovereign wealth funds, such as Brunei, Libya, Oman, and Taiwan, while its LNG-led growth potential could be likened to that of Australia, Guyana, and Qatar.
Power generation could be one of Rovuma LNG’s most transformative indirect effects. With an electrification rate of around 60%, gas-to-power initiatives using domestic LNG could expand reliable electricity access, support industrialisation, improve services, and raise living standards.
By 2056, Mozambique could approach universal electrification, reinforce its role as a regional energy hub, and continue to export surplus power. Broader energy access would reduce poverty, support communities, and drive industrial growth — making Rovuma LNG simultaneously an economic and social catalyst.
The macroeconomic implications extend to the external accounts as well. With an annual contribution of $9.2 billion to the balance of payments, Mozambique’s external position would be strengthened, reducing vulnerability to shocks and stabilising the currency. This would also encourage investment beyond LNG, promoting diversification.
The development of the LNG industry faces challenges alongside economic opportunities.
What challenges lie ahead?
The Rovuma LNG narrative is not without its challenges. The volatility of global LNG markets, the risk of excessive dependence on a single resource, and the governance demands associated with managing large revenues are all relevant factors. Mozambique’s capacity to translate natural resource wealth into broad-based development will depend on institutional soundness, transparency, and inclusive policy frameworks.
Shielding the Sovereign Wealth Fund from political interference and directing tax revenues towards long-term development would help reduce the risk of immediate spending crowding out structural priorities. In addition, the security situation in Cabo Delgado — where the gas reserves are located — remains a critical variable. Stability in the region is essential to ensure uninterrupted operations and to guarantee that local communities benefit from the project rather than being marginalised.
This domestic narrative must also be situated within the global push for decarbonisation. As countries intensify their commitments to net-zero targets, demand has grown sharply for energy sources capable of reducing carbon intensity while maintaining reliability. Natural gas, although a fossil fuel, emits significantly less carbon dioxide than coal and oil, and is increasingly positioned as a transition fuel in the global energy mix.
Rovuma LNG thus carries a dual significance: at the international level, it provides a cleaner alternative for countries phasing down coal while scaling up renewable capacity; domestically, it can expand gas-to-power initiatives and raise electrification towards near-universal coverage. In this way, Rovuma LNG is not only a driver of GDP growth and fiscal stability, but also a contribution to the global decarbonisation agenda, positioning Mozambique as a transition energy supplier and a beneficiary of its developmental effects.
The trajectory will depend on policy choices
From a development perspective, the period between 2026 and 2056 could mark Mozambique’s transition from a low-income, resource-dependent economy to a diversified, middle-income nation with stronger social indicators. LNG provides the fiscal and economic foundation, but the trajectory will depend on policy choices. If revenues are invested in education, healthcare, and infrastructure, Mozambique’s Human Development Index could rise significantly, narrowing the gap with its regional peers. Electrification could catalyse industrial growth, reduce poverty, and empower communities — making LNG a social revolution.
It is possible to envision Mozambique in 2056 as a country whose economic story is inseparable from Rovuma LNG. The project’s revenues will have financed roads, schools, and hospitals; its gas will have powered factories and homes; its jobs will have lifted families out of poverty; and the sovereign wealth fund it sustained will have safeguarded the prosperity of future generations. The transformation is not automatic, but the potential is immense. Mozambique stands on the threshold of a new era, with Rovuma LNG as its catalyst.
The challenge is to ensure that this natural resource wealth becomes a blessing rather than a curse — a foundation for inclusive growth rather than inequality. If well managed, the period between 2026 and 2056 will be remembered as the phase in which Mozambique harnessed natural gas to drive economic growth and the aspirations of its people, while making a meaningful contribution to global decarbonisation.
The Standard Bank study encourages the Mozambican government to take a leadership role in creating the appropriate commercial, fiscal, and legal conditions to enable the timely development of a competitive project.
Source: Diário Económico
Original article: https://www.diarioeconomico.co.mz/?p=528398
