a boom for whom? mozambique’s natural gas and …...abstract in the two decades since the end of...
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South African Instit
ute of Inte
rnat
iona
l Affa
irs
African perspectives. Global insights.
Governance of Africa's Resources Programme
O C C A S I O N A L P A P E R N O 1 5 1
A Boom for Whom? Mozambique’s Natural Gas and the New Development Opportunity
I c h u m i l e G q a d a
A u g u s t 2 0 1 3
A b o u t S A I I A
The South African Institute of International Affairs (SAIIA) has a long and proud record
as South Africa’s premier research institute on international issues. It is an independent,
non-government think tank whose key strategic objectives are to make effective input into
public policy, and to encourage wider and more informed debate on international affairs
with particular emphasis on African issues and concerns. It is both a centre for research
excellence and a home for stimulating public engagement. SAIIA’s occasional papers
present topical, incisive analyses, offering a variety of perspectives on key policy issues in
Africa and beyond. Core public policy research themes covered by SAIIA include good
governance and democracy; economic policymaking; international security and peace;
and new global challenges such as food security, global governance reform and the
environment. Please consult our website www.saiia.org.za for further information about
SAIIA’s work.
A b o u t t h e G o v e r n A n c e o f A f r I c A ’ S r e S o u r c e S P r o G r A m m e
The Governance of Africa’s Resources Programme (GARP) of the South African Institute
of International Affairs (SAIIA) is funded by the Norwegian Ministry of Foreign Affairs. The
programme contributes to policy governing the exploitation and extraction of Africa’s
natural resources by assessing existing governance regimes and suggesting alternatives
to targeted stakeholders. GARP examines the governance of a number of resource-rich
African countries within the context of cross-cutting themes such as environmental change
and sustainability. Addressing these elements is critical for Africa to avoid deepening the
challenges of governance and reducing its vulnerability to related crises, including climate
change, energy security and environmental degradation. The programme focuses on the
mining, forestry, fisheries and petroleum sectors in select African countries.
Programme head: Oladiran Bello, [email protected]
© SAIIA August 2013
All rights are reserved. No part of this publication may be reproduced or utilised in any form by any
means, electronic or mechanical, including photocopying and recording, or by any information or
storage and retrieval system, without permission in writing from the publisher. Opinions expressed are
the responsibility of the individual authors and not of SAIIA.
Please note that all currencies are in US$ unless otherwise indicated.
A b S t r A c t
In the two decades since the end of Mozambique’s civil war the country has depended
heavily on international donors to fund its development. Although the economy grew at
record rates from the mid-1990s, poverty levels remain above 50%. Mozambique has now
discovered natural gas deposits in large commercial quantities. These discoveries could
contribute billions of dollars to the economy and catapult Mozambique into place as the
world’s third largest exporter of LNG.
This paper investigates the likely impact on Mozambique’s socio-economic development
of discoveries of natural gas deposits, and of industrial development in the natural gas
sector. It analyses the likely uses of the ‘gas boom’ by government in contributing to the
improvement of the economic situation of Mozambicans. The discussion is set within the
context of Mozambique’s political and economic development since gaining independence
in 1975.
Whether or not the new opportunity will translate into real benefit for Mozambicans in
general depends on a number of critical factors: This report looks at those issues against the
background of the need for development in Mozambique and concludes that, although
natural gas presents a great opportunity for development and the government appears to
be committed to using the resource to improve the lives of Mozambicans, much work lies
ahead. Translating Mozambique’s natural resource wealth into developmental outcomes
will require commitment from all stakeholders, especially the government, civil society and
the private sector.
A b o u t t h e A u t h o r
Ichumile Gqada holds a Master of Social Science degree in Global Studies from the
University of Cape Town. A former researcher with the SAIIA Governance of Africa’s
Resources Programme, she currently works at the Petroleum Oil and Gas Corporation of
South Sfrica (PetroSA), where her research centres on the global hydrocarbons sector, with
particular focus on natural gas.
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G O v E R N A N C E O f A f R I C A ’ S R E S O U R C E S P R O G R A M M E
A b b r e v I A t I o n S A n d A c r o n y m S
CSR corporatesocialresponsibility
EITI ExtractiveIndustriesTransparencyInitiative
ENH EmpresaNacionaldeHidrocarbonetosdeMoçambique
FDI foreigndirectinvestment
Frelimo FrontfortheLiberationofMozambique(FrentedeLibertaçãodeMoçambique)
G-19 Groupof19aiddonorcountries,alsoProgrammeAidPartners
GBS generalbudgetsupport
GDP grossdomesticproduct
GoM GovernmentofMozambique
IEA InternationalEnergyAgency
IMF InternationalMonetaryFund
LNG liquefiednaturalgas
MDGs MillenniumDevelopmentGoals
MDM MovementforDemocraticChange(MovimentoDemocraticoMoçambique)
MGJ/a milliongigajoulesofgasayear
MW megawatt
NPI NationalPetroleumInstitute
OECD OrganisationforEconomicCo-operationandDevelopment
Parpa ActionPlanfortheReductionofAbsolutePoverty(PlanodeAcçãoparaa
ReduçãodaPobrezaAbsoluta).
PAP ProgrammeAidPartners(SeeG-19)
PRSP PovertyReductionStrategyPaper
Renamo MozambicanNationalResistance(ResistênciaNacionalMoçambicana)
SAP structuraladjustmentprogramme
SPF SocialProjectFund
TCF trillioncubicfeet
UNDP UNDevelopmentProgramme
WWF WorldWildlifeFund
M O Z A M B I Q U E ’ S N AT U R A L G A S & T H E N E W D E v E L O P M E N T O P P O R T U N I T Y
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I n t r o d u c t I o n
Since2010thegovernmentofMozambique(GoM),alongwithinternationalcompanies
involvedinhydrocarbonsprospecting,hasmadeaseriesofannouncementsofnatural
gasdiscoveries.Currently,estimatesfromtwoofthefiveexplorationblocksinCabo
DelgadoProvince,whereMozambiquemeetsTanzania,indicatethatthecountrypossesses
wellover100trillioncubicfeet(tcf)ofnaturalgas.1Theseannouncementshavegiven
risetomuchexcitement;‘ordinary’Mozambicansarehopingforimprovementsintheir
livingconditions,whiletheirgovernment is lookingforwardtobillionsofdollars in
exportrevenuesandforeigndirectinvestment(FDI).Governmentdepartmentsinvolved
inthegassectorhavemaderepeatedstatementsoftheirintentiontousethesefundsfor
nationaldevelopment.2Alongwiththiscommitmentthegovernmenthastakenstepsto
improvetheregulatoryenvironmentforhydrocarbons,includinggas,throughareview
ofPetroleumLaw3/2001of21February.ItalsocommissionedaNaturalGasMaster
PlanforMozambique(the‘MasterPlan’)thatwilloutlinescenariosforutilisationofthe
resourceonceproductionstartsin2018.3Earlyindicationsarethatthegovernmentis
consideringtwooptionsforthegas.Thefirstistosellallofitinliquefiedformonthe
internationalmarket,andthesecondistouseaportionoftheresourcefordomestic
gas-basedindustries,andexporttherest.Akeypolicyquestionishowtooptimisethe
balancebetweenthetwo,tomeetthetwinobjectivesofeconomicgrowthandsustainable
development.
Theargumentforgeneraldevelopmentofthegassectorhingesonthebeliefthatit
willbringinforeignrevenues,createjobsandboosteconomicgrowth.4GoMconsiders
thatthesebenefitswillinturncontributetopovertyalleviation,oneofMozambique’s
keypriorities.Although the logicof this isunderstandable, given thecountry’s low
socio-economicstatus,experience inmanyresource-richAfricancountriespoints to
thefactthatnaturalresourcewealthdoesnotper setranslateintoeconomicandhuman
improvement.CountriessuchasNigeria,SierraLeoneandtheDemocraticRepublicof
Congo,whichhaveabundantnaturalresources,havebeenlessthansuccessfulinusing
theirendowmentstomakethetransitionfromlow-tomiddle-incomeeconomies,orto
reachacceptabledevelopmentalindices.5
Pitfallsattendingresourceextractionhavebeenwidelydocumented.Thephenomenon
ofresourceabundanceexistingalongsidepooreconomicindicators,alsoknownasthe
‘resourcecurse’,threatenstoovershadowthehopesandpossibilitiesthatcomewithlarge
resourcediscoveries.Exportofasinglecommodity,particularlypetroleum,frequently
crowds out other economic sectors and strengthens the national currency, while
havingaconcomitantinflationaryeffectonothernon-resourceexportcommodities(a
phenomenonknownasthe‘Dutchdisease’).Thissituationrendersthenationaleconomy
overlyreliantonnaturalresourceexports,whichinturnincreasesitsvulnerabilityto
externalshocks.6Muchoftheliteratureontheresourcecursehasfocusedonoil,largely
duetoitsdominanceinthefossilfuelsindustry,anditispossiblethatthetheorymay
notnecessarilyfunctioninexactlythesamemannerwhendealingwithgas.Thiscaveat
notwithstanding,arangeofchallengesassociatedwithresourcediscoveriesandbooms
hasbeenwidelyventilated.Thereisaconvergenceofopinionthatsoundeconomicpolicy
andlaw-making,apoliticalwillandgovernmentalcommitmenttodevelopment,and
goodandtransparentgovernanceofthepetroleumsector,candomuchtoensurethatthe
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exploitationofpetroleumresourcesleadstobroadereconomicandsocialdevelopmentin
thefaceofchallengesthatinthecaseofMozambiqueamongothersincludepoverty,poor
accesstoenergy,limitedinfrastructure,unemploymentandanunskilledworkforce.
Inthepasttwodecadesgashasemergedasamajorcomponentintheglobalenergy
mix.Itisincreasinglyseenasanattractivefossilfuelalternativetocrudeoilandcoal,
becauseitiscleanerburningthaneitherandsufficientlyversatiletobeusedasdirect
domesticandindustrialheatingandpowergeneration;asadirectfuelsourceforvehicles;
andasindustrialfeedstockforliquidfuelsandotherchemicalproducts.Accordingto
theInternationalEnergyAgency(IEA)naturalgas is ‘poisedtoenteragoldenage’.7
Asignificantproportionofthecominggasboomwillbefromunconventionalresources
suchasshalegasandcoal-bedmethane,providedthat thesocialandenvironmental
impactsassociatedwiththeirextractioncanbeameliorated.By2035gaswillovertake
coalasaprimaryenergysource,tocomprise25%oftheglobalenergymix–secondonly
tocrudeoil.8Similarly,ithasbeenarguedthat‘gasistheonlyfossilfuelsettoincreaseits
shareofenergydemandintheyearstocome’.9Whereasthegasboomreliesprimarilyon
unconventionalgas,conventionalgasresourcessuchasthoseinnorthernMozambique
certainly have a role to play. Currently, successive discoveries of conventional and
unconventionalgasresourcessuggestarevolutionintheglobalenergyindustrymaybeat
hand.Whatthiswillmeanforgovernmentsandnationaleconomicdevelopmentdepends
onthegovernancemechanismsandmanagementsystemsputinplacetoensurethatthe
resourceistransformedintotangiblesocialbenefit.
WhetherGoMwillbeable tokeep to itsobjectiveofusinggas fordevelopment,
eitherthroughrevenuesfromexportsorthecreationofdomesticgas-basedindustries
oracombinationofboth,largelydependsonthewayinwhichthesectorisgoverned.
Itistooearlytostatewithanycertaintythattheexploitationofthisfiniteresourcewill
benefitthemajorityofMozambicans.Giventheadoptionandimplementationofsound
governancepolicies,however,togetherwithcompetentandtransparentadministrative
processes,effective,functionalandindependentoversightinstitutionsandacommitment
todirectingprofitstowardsocio-economicdevelopment,GoMcangosomewaytoavoid
theresourcecurseanditsconsequenceswhileadvancingitsstateddevelopmentalgoals.
ThispapersetsouttoconsidertheimplicationsofthegasdiscoveriesforMozambique’s
socio-economicdevelopment.ItexaminestheextenttowhichGoMhasconceptualised
andunderstooddevelopmentsincetheendofthecivilwarin1992,inordertosuggest
howitmightfacilitate futuredevelopment inthepetroleumsectorandtheeconomy
ingeneral. Indoingso itdrawson field researchconducted inMozambique,policy
documents,internationalbestpracticeguidesandexistingliteratureonvariousaspectsof
Mozambique’sdevelopment.
b A c K G r o u n d
The11provincesand128districts thatmakeupMozambique liebehindtheIndian
Oceancoastlineof south-easternAfrica.The country sharesborderswithTanzania,
Malawi,Zambia,Zimbabwe,SouthAfricaandSwazilandandcoversasurfaceareaof
799 390km2,ofwhich786 390km2and13 000km2arerespectively firm landand
inlandwaters.Itscoastlineruns2 700kmfromnorthtosouth,andthecountry’sclimate
M O Z A M B I Q U E ’ S N AT U R A L G A S & T H E N E W D E v E L O P M E N T O P P O R T U N I T Y
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rangesfromtropicaltosubtropical.Mozambique’scoastalpositiongivesitageographical
advantageoveritsinlandneighbours,whichuseitsportsasentryandexitpointsfor
theirinternationaltraffic.Thenationalcapital,Maputo,isinMaputoProvince,alongthe
southernmosttipofthecountryandborderingSouthAfricaandSwaziland.Thegreat
majorityofthecountry’s24millioninhabitantsareruraldwellers,morethan50%ofthem
livingbelowthe$1.25adaypovertyline.TheofficiallanguageisPortuguese,although
Englishisusedextensivelyasthebusinesslanguageinthemaincities.Amongthemany
otherlanguagesspokenareMakhuwa,Ndau,Tsonga,LomweandSena.10
MozambiquegainedindependencefromPortugal in1975.Sincethenthecountry
hasbeengovernedbyFrelimo,theFrentedeLibertaçãodeMoçambique(Frontforthe
LiberationofMozambique).Mozambiquehashadamulti-partydemocraticpolitical
systemsince1990andheldfourroundsofgeneralelectionsbetween1994and2009and
threeroundsofmunicipalelectionsbetween1998and2008.Themainoppositionparty
isRenamo,theResistênciaNacionalMoçambicana(MozambicanNationalResistance),
although the newly-formed MDM, the Movimento Democrático de Moçambique
(DemocraticMovementofMozambique)isgrowinginnumbersandholdsthemayoral
seatsinBeira,SofalaProvinceandQuelimane,ZambeziaProvince.
Mozambique’s economy includes services sectors (taking in transport), some
manufacturing,fisheriesandagricultureaswellaselectricityexportstoneighbouring
countries,includingSouthAfrica.Donoraidisthesinglebiggestcontributortothenational
budget,ataround50%in2010.11Thecontributionofextractiveindustriestothefiscus
is,however,growingrapidly.AccordingtoMinisterofMineralResources,EsperançaBias,
in2011grossdomesticproduct(GDP)increasedto$13,740billionfrom$10,420billion
thepreviousyear12.Althoughthevalueofexportsbegantodeclinefrom2010,in2011
theeconomygrewatanannualrateof7.2%,upfrom6.8%in201013.Inrecentyearsthe
countryhasemergedasaresourcehaven.Inadditiontorichdepositsofcoalandnatural
gasMozambiquehassignificantdepositsofheavymineralsands;limestone;bauxite;rare
earths;graphite;goldandbaseminerals,amongothers.Dependinguponhowtheyare
managed,suchnaturalresourcescouldliftMozambiqueintomiddle-incomestatus.
Gashasbeendiscoveredintwoareas:theRovumaBasinoffthecoastofCaboDelgado
Province,and theMozambiqueBasin,anon-andoffshoreareaspanning thecoastal
provincesofInhambaneandSofala(seeFigure1).Currently,gasisbeingproduced(by
theSouthAfricanintegratedenergyandchemicalscompanySasolLtd)onlyatthePande
andTemanefieldsinInhambaneProvincebutplansareunderwayforproductioninthe
RovumaBasintobeginby2018.
Preliminaryindicationspointtothepossibilitythatgasdevelopmentandproduction
mightadverselyaffectothereconomicsectors.CaboDelgado,forexample,isatourist
destinationandecologicalhubandthelocationoftheprotectedQuirimbasNationalPark.
ArepresentativeoftheWorldWildlifeFund(WWF)inMaputobelievestherichecology
anditsattendanttourist trademaybenegativelyaffectedbygasproductionplanned
forthearea.14TheinternationalenvironmentalnetworkFriendsoftheEarthaffiliate,
JustiçaAmbiental,conductedfieldresearchintheRovumaBasinin2009.Thestudycites
compellingevidencethatseismicstudies(usedinpreliminaryinvestigationstodetermine
whetherrockformationscontainoilorgas)alreadymayhaveharmedmarineanimals,
whilealsoresultinginalossofincometolocalartisanalfishermenduetofishstockdeaths
andmigration.15Similarconcernshavebeenexpressedregardinggasdevelopmentforthe
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centralcoastalareasofMozambique,wherecoastalcommunitiesderivetheirlivelihoods
fromartisanalfishing.
Resourceextractionnecessarilyhasanimpactontheenvironmentandforthatreason
achievingcompleteenvironmentalbalanceandharmonyistoallintentsandpurposes
impossible,neverthelessallactivitiesshouldaimtolimitanyenvironmentaldegradation
thatmightresult.Thisapproachisalreadyaddressedinlawandinenvironmentalimpact
assessments:maintainingenvironmentalintegrityshouldnotbesidelinedastheresource
revenuesthresholddrawsnearerandthestakesgethigher.Thereisafurtherfearthat
asthedateloomsforinitialproductionintheRovumaBasin,fisheriesandagriculture,
whichareimportantsubsistencesectors,maybeneglectedinfavourofthemoreprofitable
petroleumsector.16TheGoMshouldtrytoallaysuchfearsthroughagenuinecommitment
tofurtherdevelopingthesesectors,notonlybecausetheyareactivitiesthattraditionally
havesupportedlivelihoodsbutalsobecauseoftherisksinherent inover-relianceon
exportsofasinglenaturalresourcecommodity.
m o Z A m b I Q u e ‘ S h y d r o c A r b o n S S e c t o r
ExplorationinMozambique’shydrocarbonssectordatesbackmorethanacentury,to
the1904discoveryofonshoresedimentarybasinsintheMozambiqueBasin;financial
andtechnologicalconstraintspreventeditsdevelopment.Between1961and1967further
onshorediscoveriesbymultinationaloilcompaniesatPande,BuziandTemaneinthe
MozambiqueBasinprovedthepresenceofhydrocarbonsreserves,althoughatthatpoint
theircommercialviabilityremaineduntested.17Politicalunrestduringthestrugglefor
independencefollowedbythecivilwarbetweenFrelimoandRenamohaltedfurther
explorationordevelopmentofthehydrocarbonssector(atthetime,also,international
interest inpetroleumresourceswas focusedon themore lucrativecrudeoil sector).
Recognising the potential of hydrocarbons as an energy input, however, the GoM
establishedanationaloilcompany,EmpresaNacionaldeHidrocarbonetosdeMoçambique
(ENH),inthe1980s.ThiswasfollowedbyamappingandappraisalexerciseatPande,
wheregashadalreadybeenstruckinthe1960s.18
Intheearly2000sSasoldrilledandsuccessfullyappraisedthePandeandTemane
fields,provingthecommercialviabilityofgasreservesofaround2.7tcf,equivalentto
25years’production.19Ataninitialcostof$1.2billion,Sasol,theSouthAfricangovernment
andtheGoMtogethersignedanagreementin2000allowingfortheintroductionof
Mozambique’sgasintotheSouthAfricanmarket.20Projectworkontheventurebegan
in2002andfirstproductionandexporttoSouthAfricatookplaceinFebruary2004.
Withatotallifespanof25years,theprojectisstructuredinthreeeight-yearphases.
Inthefirstofthese(2004–2012)Sasol’sproductioncapacitywas120milliongigajoules
ofgasayear(MGJ/a).ThebulkoftheproductwasexportedtoSouthAfricathrough
an 865 km pipeline connecting the central processing facility near the Pande and
TemanefieldstoSasol’sfacilitiesatSecundainSouthAfrica’sMpumalangaProvince.21
Thesecondphase,beginninginearly2012,hasaproductioncapacityof183MGJ/a,most
ofwhichwillbeexportedtoSouthAfrica.Asmallerproportion(27MGJ/a)willbesold
ontheMozambicanmarketand9MGJ/awillremaininMozambiqueasroyaltygas.22
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Figure 1: Natural gas fields in Mozambique: operational and proven reserves
Source:NationalPetroleumInstitute(InstitutoNacionaldePetroleo),Maputo,AcreageMap&INP
Database,http://www.inp.gov.mz/Exploration-Production/Maps.
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ThesituationinthegasindustryhaschangedsinceSasolbeganitsproductionand
exports. In Mozambique, game-changing discoveries of conventional gas have been
madeintheRovumaBasin,whichcouldearnMozambiquebillionsofdollarsinFDI
and export revenues. Internationally, the use of relatively new technologies in the
extractionofunconventionalgashasgivengreateraccesstoapreviouslyinaccessible
resource,therebyraisingtheprofileofgasasanenergyinputinthefossilfuelsmarket.
InJuly2005theNationalPetroleumInstitute(NPI),whichisresponsibleformanaging
Mozambique’spetroleumresourcesandadministersoperations,announcedMozambique’s
secondpetroleumlicensinground,‘focusedontheRovumaBasinoffthecoastofCabo
DelgadoProvince’.23Sincethatannouncementmultinationalpetroleumcompanieshave
enteredMozambiqueinsearchofopportunitiesinthegassector.Subsequentlytwoother
licensingroundswereopened,withafifthexpectedin2013.Todate,mostoftheinterest
inMozambique’shydrocarbonscentresontheRovumaBasinandontheMozambique
Basininthecentralon-andoffshorearea.CurrentestimatesfromexplorationbyUS
companyAnadarkoPetroleumCorporationandtheItalianintegratedenergycompany,
ENI,arethattheRovumaBasinaloneholdsinexcessof100tcfofthegasresourcein
place.24
ThefourpetroleumlicensingroundstodatehaveresultedintheGoM’sawarding
severalconcessionsforhydrocarbonsexplorationin11areasintheMozambiqueand
Rovumabasins.InaccordancewiththeprovisioninPetroleumLaw3/2001that‘theState
reservesitself[sic]therighttoparticipateinPetroleumOperationsinwhichanylegal
personisinvolved’,25ENH,asMozambique’snationaloilcompany,hasastakeineach
oftheexplorationblocks,allowingfordirectrepresentationofthenationalinterestat
decision-makinglevelineveryconsortium.26Thegovernment,withENHasitsvehicle,
expectstocarryitsshareholdingthroughtothedevelopmentofeachoftheblocks,a
provision also enshrined in law. Despite current record annual economic growth
rates,financiallythisundertakingwillrepresentamajorchallengefortheGoM.ENH,
however,believesthatfinancewillnotbeasignificantobstacle,andis‘lookingtobanks
andre-evaluatingitsassets’tofindwaysoffinancingthenextstageofdevelopmentin
theexplorationblocks.27Thecompanybelievesthatitisinthenationalinterestthatit
maintainsashareholdingintheconcessionblocks,whichcanbeusedbythegovernment
tomaximisethebenefitofthegasrevenuesforthepeople.28
Tables1and2showeachoftheexplorationblocksbyoperatorandtheshareheldby
ENHas‘GoM’srepresentativeintheoilandgasindustry’.29
MajordiscoveriesinArea1andArea4haveresultedinfiercebiddingforstakesin
eachoftheblocksassomecompanieshavesoughttorelinquishtheirsharesandothers
seekentryintothisfrontierarea.Asanexample,in2012London-basedCoveEnergyPLC
soldits8.5%stakeinArea1toThailand’snationaloilcompanyPTTEPfor$1.9billion.
Inthefirstquarterof2013,ENIcommitteditselftoselling20%ofitsstakeinArea4to
theChinaNationalPetroleumCorporation(CNPC),andcurrentlyadealispendingon
thesaleofa20%stakeonofferinArea1.Asexplorationbeginsintheotherblocksin
theRovumaBasinthereisastrongpossibilitythatthetrendtowardstradingstakeswill
continue.
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Table 1: Exploration blocks in the Mozambique Basin
Block Operator ENH share
Sofala Sasol 15%
M-10* Sasol and Petronas (Malaysia) 15%
Areas 16 and 19 Sasol 15%
Area A Sasol 10%
Buzi PT Kalila Energy (Indonesia) 25%
Inhaminga DNO International (Norway) 20%
*ThewelldrilledbySasolinBlockM-10hassincebeenpluggedandabandonedasitdid
notencounteranysignificanthydrocarbons.Preliminaryexplorationactivitiescontinue
intheotherblocks.
Source:compiledbyauthor.
Table 2: Exploration blocks in the Rovuma Basin
Block Operator* ENH share
Onshore Area Anadarko Petroleum 15%
Offshore Area 1 Anadarko Petroleum 15%
Blocks 2 and 5 Statoil (Norway) 10%
Blocks 3 and 6 Petronas 10%
Area 4 ENI 10%
*Mostoftheoperatingcompaniesareinconsortiumwithotherinternationalpetroleum
companiesintheirrespectiveexplorationblocksbutthesehavenotbeenlisted.
Source:compiledbyauthor.
TheRovumaBasinholdsmostof thegasresourcesofardiscoveredinMozambique.
AnadarkoandENI,thecompaniesleadingexplorationintheBasin,haveindicatedthat
thevolumeofprovengasreservesjustifiesconstructionofaliquefiednaturalgas(LNG)
facilityonthecoast.InDecember2012thetwocompaniessignedaHeadsofAgreement
thatwillallowforco-ordinatedeffortsindevelopingaLNGplanttoreceivegasfromthe
offshorefields,andpre-treatandprocessitinpreparationforstorageandexport.30There
isafairmeasureofcertaintythatmostofthegasfromtheRovumaBasinwillbesoldon
theinternationalmarketandAsiancountrieshavealreadybeenidentifiedasitsprimary
customers.
There have been calls, however, from within government and from civil society,
to ensure that the gas is also used domestically to address some of Mozambique’s
pressingsocio-economicchallenges.31Theseproblemsinparthavebeeninheritedfrom
Mozambique’scolonialpastandfrompost-colonialsocialistpoliciesthatfailedtoaddress
thelegacyofthelongPortugueseoccupation,16yearsofcivilwarbetweenFrelimoand
Renamothatbegantwoyearsafterindependence,andpost-transitionpoliciesthattodate
havebeenlessthanentirelysuccessfulinaddressingmajorsocio-economicproblems.
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c o m I n G o f A G e : m o Z A m b I Q u e ’ S P o L I t I c A L A n d e c o n o m I c h I S t o r y
MozambiquewasaPortuguesecolonyuntil1975.Duringthecolonialeratheeconomy
wasdominatedbyagriculture,trade–mainlywithSouthAfricaandZimbabwe(then
Rhodesia)–andremittancesfrommigrantlabourersworkinginneighbouringcountries.
Because the colonial government had remitted the bulk of revenues generated in
MozambiquetoLisbon,theseatofthecolonialpower,atindependenceinJune1975
thePortugueseleftbehindthemaneconomythathadnotenjoyedallthefruitsofthe
indigenouspopulation’slabour.Frelimoinheritedalargelyuneducatedandunskilled
population;acountrywithweakinfrastructureravagedbyadecade-longindependence
war, low investment in infrastructureand the lootingofpublicpropertybycolonial
authoritiesonceitemergedthatindependencewasinevitable.32
Portugal’srapidwithdrawalandhandoverofpowertoFrelimowasfollowedbythe
establishmentofaone-partystatebasedonMarxistideology.33Frelimoaligneditselfwith
theUSSRandsoonaftercomingtopowerembarkedonaprogrammeof’socialistreform’.
SouthAfricaandRhodesia,respectivelystillunderApartheidandminorityrule,responded
bydown-scalingtheireconomicco-operationwithMozambique.Thishadadevastating
effectontheabilityoftheFrelimogovernmenttoovercomethesocio-economicruin
thatthenewly-independentstatehadinherited.Theimpositionofacentrallydirected
economy,agradualexodusofskilledPortuguesenationals,weakeningeconomicties
withneighbouringcountriesandalargelyuneducatedpopulation,furtheraggravatedthe
desperatemalaisethatcharacterisedpost-colonialMozambique.
Thesituationdeterioratedfurtherin1977whenRenamo,backedbyRhodesiaand
SouthAfrica,launchedacivilwaragainsttheFrelimogovernment.34Thewardiverted
attentionfromurgenteconomicquestionsandfurtherdestroyedtheinfrastructure.35By
the1980s,influencedbytheimminentcollapseoftheSovietUnion,persistentdomestic
economicdeclineandthedebilitatingeffectofanoverlydominantstate,theFrelimo
governmenthadstartedtoturntotheWest.Newpoliticalalliancesandnewsourcesof
funding,however,camewithconditionsattached.Mozambiquefounditselfcompelled
tojointheInternationalMonetaryFund(IMF)andtheWorldBankandtoadopttheir
structuraladjustmentprogrammes(SAPs).AtthesametimeMozambiqueabandonedits
centrallyplannedsocialisteconomyinfavourofneoliberaleconomicpolicies.In1987the
IMFandtheWorldBanksponsoredan‘EconomicRecoveryProgramme’forMozambique
which,althoughshowingpositiveindicatorsformacro-economicgrowth,carriedwithit
asocialcostevidencedbydecliningwages,risingfoodpricesandhighinflation.36The
movetoamarket-basedeconomywas,however,followedbyaninflowofdevelopment
aidandprivatecapital,mainlyfromWesterncountries;37newfundingthatcontributedto
improvedeconomicgrowthinthelate1980sandservedtocushiontheimpactofSAPs
onsocialindicators,withforeignaidincreasinglydirectedtowardshumandevelopment
bytheearly1990s.
Whileaneweconomicorderwasbeingestablished,changesinthepoliticallandscape
werealsoundernegotiation.DirectpeacetalksbetweenFrelimoandRenamobeganin
1990andanewconstitutionenshriningfreeandfairmultipartyelectionswasadoptedin
Novemberofthesameyear.ThewarfinallycametoanendwiththesigningoftheRome
GeneralPeaceAccordsin1992.38Thefirstdemocraticgeneralelectionswereheldin
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1994withFrelimowinningamajorityinbothpresidentialandparliamentaryelections.
Thepartywentontowinboththepresidencyandaparliamentarymajorityingeneral
electionsin1999,2004and2009.39
Fromthebeginningof the1990s itbecame increasinglyclear thatMozambique’s
neweconomictrajectorywasnotwithoutcontroversyorcontradictions.Thepurported
benefitsofSAPsandforeignaidnotwithstanding,theeconomyagaindeclinedinthe
early1990sandalongwithit,realpercapitaincome.Exportsfellandthebudgetdeficit
continuedtoincreaseinspiteofgovernmentbudgetcuts.40
AtthatpointitproveddifficultforWesterninstitutionspromotingtheWashington
ConsensustoclaimunqualifiedsuccessinMozambique’seconomictransformation.Asthe
countrystoodonthethresholdofrealdemocracyitfounditselfinaveryweakeconomic
position.Bytheendofthecivilwarin1992itwasnotonlyoneofthepoorestcountries
intheworld,butwasalsoamongthemostheavily-indebted,withanexternaldebtbillof
over200%ofGDPbythemid-1990s.41Atthebehestofvariousmultilateralinstitutions
thegovernmenthadtighteneditsbudgets,adoptedfiscalpolicyreformstomeetfree-
marketimperatives,removedsubsidies,devaluedthecurrencyandopeneduptheborders
tocheapimports.Socially,thewarhadresultedinmorethanamillioncasualties,the
internaldisplacementofthreemillionpeople,andfurtherdestructionoftheremaining
infrastructure,includinghealthandeducationfacilities.42Allthesefactorscontributedto
asevereimpairmentofgenerallivingconditions,theameliorationofwhichformedurgent
prioritieswhichtheGoMneededtoaddressthroughdonoraidandwithwhateverpolicy
instrumentswereavailabletoit.
Inthe1990sagroupof19donorgovernmentsandagencies(theG-19,alsoknown
astheProgrammeAidPartners[PAP]),committeditselftoassistingMozambiqueby
increasingfinancialaidandinstitutionalandpolicy-makingsupport.Initiallythiswas
directedtowardsapeacefultransitiontomultipartydemocracybutlatereffortswent
towards promoting socio-political inclusiveness in Mozambique’s democratisation
programme.43Intheyearsfollowingthefirstdemocraticelectionsdonorshadengaged
inproject-basedsupportaspartofawideragendaofpromotingdemocracyandgood
governance,whichlateralsoshiftedtosupportforthecentralstatebudget.44Record
annualeconomicgrowth–hoveringaround7–8%fromthemid-1990sintothe2000s–
andrelativepoliticalstability,encourageddonorstoviewMozambiqueasanexemplarfor
donoraidtofostertheachievementof‘peace,stabilityandgrowth’.45
DonoraidtoMozambique,inatimeoflimitedeconomicindependence,infacthashad
asignificantimpact:onstatebudgeting,onpovertyalleviationandonpolicy-makingand
politics.AlthoughtherehavebeenclaimsthatMozambiquehasreliedsoheavilyondonors
thatithasbecome‘aidaddicted’,46exponentialgrowthintheextractivesector,alongwith
concomitantFDIinflows,hasledtoprojectionsofadeclineinaiddependence.Apattern
isbeginningtoemerge.In2010externalsupportforthestatebudgetwas51.4%;thishad
droppedto44.6%in2011,suggestinganincreasedgovernmentcapacitytofunditsown
spending.Inthesametwoyears,mainlyduetoaboomingextractivesector,FDIdoubled
from$1billionto$2billion,withtheWorldBankestimatingthatMozambiquecould
receive$70billioninrevenuesfromgasprojectsby2020.47Asitsburgeoningminingand
hydrocarbonsindustriesbegintoconfergreaterfinancialindependencetherelationship
betweendonorsandtheGoM,asaidrecipient,isboundtochange.Addressingthelikely
outlookofgovernment’srelationshipwithdonors,inaDecember2012interviewwiththe
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Belgium-basedmagazineGREAT Insights,PresidentArmandoGuebuzaindicatedprecisely
howtheGoMseesfuturerelationswithdonors:
‘...therelationshipwillprobablychangeinthesensethatastimegoesonandaswehave
moreresourcesinourbudget,wearegoingtoneedmorebusinessandcommerciallyoriented
relationswiththosecountriesthathavetraditionallyprovideddevelopmentfunding.Itwill
shiftastimepasses;inabout10years’timewewillnotberelyingondonationslikeweare
today.Wecanexpectagradualshiftinthefocusoftherelationship.48
ItisclearthattheGoMseesrelationsmovingmoretowardseconomicpartnershipthan
aiddependence.FortuitouslythisshiftcomesatatimewhengovernmentsinOrganisation
forEconomicCo-operationandDevelopment(OECD)countries(whichincludemostof
Mozambique’sdonors)aretighteningbudgets.49Dependingonhowitisnegotiatedand
managed,thechangingnatureofthedonor-recipientrelationship,whilegradual,maywell
servethefutureinterestsofboththeG-19andMozambique.
f r o m d o n o r S ’ d A r L I n G t o r e S o u r c e - b A S e d S o v e r e I G n t y ?
DonoraidhascomeintwostreamsfromtheG-19.First,donorshavedirectlyfunded
specificprojects.Thisassistancehasbeenintheformofdirect institutionalcapacity
building at national and local level, primarily for improving service delivery and
administrativeskills.Secondly,theG-19directlyprovidesgeneralbudgetsupport(GBS)
tothestateinordertohelpthegovernmentfunddevelopmentprojects,suchaspoverty
reductionprogrammes.
Soonaftertheelectionsof1994donorsrealisedthatdespiteitsmeasurablesuccesses,
projectsupportbroughtwithitheavypitfalls,someofwhichhavebeendocumentedby
TonyHodgesandRobertoTibana(amongothers).Theyarguethatdependenceondonors
hasalsocarriedsignificantimplicationsforMozambique’sbudgetingandgovernance.
Projectsupportcreatesburdensonanalreadyoverstretchedpublicserviceandhasserved
tofragmentstateplanningwhenprojectslocatedwithinspecificdepartmentsdemand
functionalandreportingproceduresdifferentfromnormaldepartmentalprotocols.The
prevailingviewthatreformisdrivennotfromwithinbutexternallybydonorcountries
andagencieshascreatedapublicservicethatisacquiescentratherthanproactive.The
furtherfactthatsomeprojectsaredirectlyfundedwithmoneythatbypassesthetreasury
imposesyetmorereportingandadministrativeburdens,increasestransactioncostsfor
theGoMastherecipientgovernment,andopensupthescopeforfundstobesiphonedto
otherchannels.50Tosomeextenttheseshortcomingshavetaintedthemeasurablesocio-
economicsuccessestheGoMhasachievedwiththeassistanceoftheG-19since1992.
These and other deficiencies led to the introduction of GBS alongside targeted
programmesupport.Formorethanadecadesincethen,donoraidhascomprisedabout
50%of theGoM’s totalbudget.Thisdominanceof aid in thebudgetpromptedone
economisttorefertoMozambiqueasan‘aid-addicted’countrythatwouldbebankrupt
without the constant stream of aid’;51 he argues that the ‘problem’ has become so
entrenchedthataidinMozambiquehasbecomea‘renewableresource’.52Suchcriticisms
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notwithstanding,assistancefromtheG-19,whetherprimarilythroughGBSinrecent
yearsorfromprojectsupportearlier,hashelpedMozambiquetoachievestableannual
economicgrowthratesaveraging8%sincethelate1990s.53Thecountryhasdiversified
itseconomytoincludethreemainsectors:agriculture,industry–primarilyintheform
ofaluminiumfortheexportmarket–andservicesprovidedmainlybygovernment.54In
addition,after2001theGoMadoptedstrategiesandprogrammesspecificallytargeting
humandevelopment.By2008therehadbeennotableprogressinthisregard.Therate
ofabsolutepovertyfellfrom70%tojustover50%inthedecadefrom1997;in2009per
capitaGDPhadalmostdoubled,to$454,fromthe1997benchmark;theadultliteracy
ratestoodat50%in2008comparedwith40%in1997;accesstowaterandsanitation
hadincreasedmarkedlyby2008;maternalandinfantmortalityratesweredownandfrom
1997theprimaryschoolingcompletionratehadmorethantripled,to77%in2008.55
Inspiteof thesesuccessesthere isaconcernthatdonorfundingincreasinglyhas
divertedtheprerogativeofpolicy-makingfromMozambicandecision-makerstowards
donors, and thatdependenceonaidhasmade thegovernmentmoreaccountable to
donorsthantoitsownpopulation.56Expressingsuchasentiment,CarrieManningand
MonicaMalbroughwritethatinsupportingmulti-partyengagementinthefirstelections,
donorshavebeenviewedbothbyFrelimoandRenamoasaconstituencythatmightbe
moreimportantthaneventhevotersthemselves.57HansAbrahamssonalsoarguesthat
acalamitousoutcomeofdependenceondonorshasbeentheencroachmentofdonor
countriesontheeconomicandpoliticaldecision-makingprocessesinMozambique.58
Similarly,PaolodeRenzioandJosephHanloncontendthatsincetheendofthecivilwar
theGoMhasforegoneadrivefora‘nationalagenda’inexchangefortheadoptionofdonor
policiesthathaveservedto‘ensureasteadyinflowofresources’.59Thesheerscaleofdonor
aidhasboughttheG-19aseatatthepolicy-makingtableinMozambique,whichhasled
tocriticismsthatthedomesticagendahasbeenhijackedinfavourofwhatdonors,rather
thangovernment,regardasmoreimportant,erodingtheprerogativesofdomesticpolicy-
makerstofulfilthemandategivenbytheelectorate.Atthesametimepolicy-makinghas
seenasystematicexclusionofcivilsocietyagenciesandthenationalassembly,bothof
themobviouslykeystakeholdersindomesticaffairs.
InapaperanalysinghowhydrocarbonwealthmightimpactonMozambique’sdonor
aidprogrammes,EmilyAndersonarguesthattheboomingextractivesectorwillleadto
economicchangeswhichinturnwilldemandareassessmentofthecurrentpatternof
aid.60Asextractiveprojects,particularlyforgas,comeonline,thetraditionalNorth-
Southdonor fundingchannel favouredby theG-19might slowlygiveway toa less
conventionalinvestmentmodelalignedwiththeEastandSouth,whichwillbringwithit
greatercommercialopportunitiesforMozambique.61Theselatter,broaderrelationships
willnotbebasedonpolicyconditionalities,aswasnormallythecasewiththedonor-
recipientrelationshipbetweentheGoMandtheG-19.Furthermore,futurerevenuesfrom
hydrocarbonsandareduceddependenceoninternationalaid–evenmorepronounced
whenminingrevenuesarefactoredin–willoccuratatimeofdecliningaidbudgets
fromestablisheddonors,arisingfromthecurrentglobaleconomicmalaiseandpolitical
pressuresondonorgovernmentstospendlessinareaswhichtheirelectoratesdonot
considercentraltotheirinterests.Suchasituationislikelytoreducetheinfluenceof
donors on Mozambique’s domestic politics and policy-making while increasing the
leverageoftheGoMinnegotiatingaidconditions.
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In2011theUNDevelopmentProgramme(UNDP)rankedMozambique184outof
187countriesintermsofhumandevelopment,measuredbyaggregatinglifeexpectancy,
educationand the standardof living.62This shows thatdespite substantialprogress
Mozambiquecontinuestofacepersistentsocio-economicchallengesthatmakeitoneof
theworld’spoorestandleastdevelopedcountries.Ahighpercentageofthepopulation
stilllivesbelowthepovertylinewithinadequateaccesstoformalemployment,health
care,formaleducationandenergy.Alargelyruralpopulation,itisreliantonsubsistence
farming;thereisamarkedvulnerabilitytonaturaldisasterssuchastropicalcyclonesand
floods;foodsecurityandmalnutritionisdeclining;andtheHIV/Aidspandemiccontinues.
Withinthiscontext,inSeptember2000Mozambique,with188othernations,signed
the Millennium Declaration under the auspices of the UNDP. This initiative seeks
to improvehumandevelopmentby2015,using eight strategic goals in sectors that
includehealth,educationandtheenvironment.63In2001,soonaftercommittingtothe
MillenniumDevelopmentGoals(MDGs),theGoMdrafteditsfirstPovertyReduction
StrategyPaper(PRSP):the‘ActionPlanfortheReductionofAbsolutePoverty2001-2005’
(Plano de Acção para a Redução da Pobreza Absoluta:PARPA).Thiswasfollowedbytwo
furtherPRSPs:‘ActionPlanfortheReductionofAbsolutePoverty2006-2009’(PARPAII)
andPovertyReductionActionPlan2011-2014(PARP).ThecentralobjectiveofPARPA
Iwastoreduceabsolutepoverty‘from70%in1997tolessthan60%in2005andless
than50%bytheendofthisdecade’.64PARP,thethirdstrategypaper,aimstouse‘pro-
poor’initiativestoreducetheincidenceofpovertyfrom54.7%in2009to42%in2014.65
TheGoMseespovertyalleviationasoneofitskeyhumandevelopmentobjectivesandit
continuestousethethreestrategypapersasblueprintsforachievingthisgoal.Donors
havesupportedthisthroughprovidingGBSatthenationallevel;supportrenewedin
2009whentheG-19statedinamemorandumofunderstandingwiththeGoMthat‘The
overallobjectiveofthePAPs’BudgetSupporttoMozambiqueistocontributetopoverty
reductioninallitsdimensions’.66
TheG-19alsostatedthat‘thePAPs’BudgetSupportshouldhelpattainthemutual
objectivesofpoverty reductionand theMillenniumDevelopmentGoals (MDGs) in
Mozambiquebyprovidingbudgetfinancingtothepublicsectorforpovertyreduction.’67
InadditiontodonoraidMozambiquehasalsobenefitedfromtheHeavilyIndebted
PoorCountries(HIPCs)andMultilateralDebtReliefInitiative(MDRI)fromtheWorld
BankandIMFwhich,inrecognisingtheadverseeffectofheavylevelsofdebtonpoverty
alleviation,soughttoeasethe financialburdenonqualifyingcountries.68While it is
undeniablethatMozambiquehasmadeprogressinhumandevelopmentandreaching
MDGs,criticismspersistthatcontinuedrelianceondonoraidhasrendereditsgovernment
weakinthefaceoftheG-19anditsdonor-ledagenda.
Gas for development
AsaresultofitssubstantialcoalandgasdiscoveriesMozambiquehasemergedasafossil
fuelsresourcetargetforinternationalenergycompanieslookingtoextendtheirfootprint
inthesector.Thisparticularlyappliestotheworld-classcoaldepositsoftheMoatizeBasin
inTeteProvinceandofferspotentialforunprecedentedrevenuestreamsforgovernment,
providedtheGoMisabletodeveloparegulatoryregimethatwillallowitfullytocapitalise
ontheabundantresources.
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AccordingtoPetroleumLawNo3/2001‘Petroleumresourcesareassetswhoseproper
exploitationcancontributesignificantlytonationaldevelopment’,69apositionechoed
11yearslaterintheexecutivesummaryoftheMasterPlanDraftReport,whichsuggests
thattheGoMshoulddevelopnaturalgasresourcesinamannerthatmaximisesbenefits
toMozambiquesociety[sic]...inordertoimprovethequalityoflifeforthepeopleof
Mozambique,whileminimisingadversesocialandenvironmentalimpacts.’70
RecognisingMozambique’ssocio-economicchallengesandthepitfallsitmightholdfor
naturalresourcedevelopment,thedocumentalsoacknowledgesthat:71
...whilethesegasdiscoveriesareanadditionaleconomicwindfallforMozambique,they
presentseriouschallengestotheGoMinthebroaderpoliticaleconomy.Thesechallenges
lay[sic]inhowtoencouragedevelopmentoftheresourcesinawaythatbringsthegreatest
benefittoMozambique.
Muchofthediscoursewithingovernment,civilsocietyandthedonorcommunitycentres
on themainoptions forutilisationof the resource: respectivelyexportof the larger
proportionofthegas,andretentionoftheremainder,intheformofroyaltyandprofitgas,
tobeusedtostimulateagas-basedindustryinMozambiqueitself.TothisendtheMaster
PlanDraftReportexecutivesummarystates:72
‘Ontheonehand,promotingthedevelopmentofexport-centeredLNGprojectswillgreatly
addtogovernmentrevenuesthroughmonetizationofroyaltiesandMozambique’sshare
profits.ThisisrevenuethatMozambiquecanuseinternallyfordevelopment.Ontheother
hand,royaltiesandprofitscanbeusedin-kindwithinMozambiquetopromotevalue-added
manufacturingthat increases localemployment,promoteslocalbusinesses,andcreates
potentiallybroaderbenefitsacrossthecountry’.
AccordingtoaGoMofficial,‘governmentwillusegasandcoaltoindustrialisethecountry,
tobringinrentsandtocreatejobs.Thefocusisonthepeopleandeconomicgrowth’.73
ThereisindeedevidencetosuggestthattheGoMisalreadytakingstepstowardsthisgoal.
InOctober2012,afterthreeyearsasacandidatecountry,Mozambiquewasgrantedthe
statusofafullycompliantmemberoftheExtractiveIndustriesTransparencyInitiative
(EITI).74TheGoMseesthatstatusasonewaytopromotetransparency.75Italsoregardsits
commitmenttoimplementingtheEITIstandardasafirststeptoensuringthatthesector
generateswealthforMozambique.76
The government recognises that for the petroleum sector to function optimally,
politicalandcorporategovernanceofthesectorshouldbestrengthened.Tothisend,ithas
commissionedastudyoncorporatesocialresponsibility(CSR)inMozambique.According
toaseniorofficialinthemineralresourcesdepartmenttheoutcomeofthisstudywill
informtheconductofminingandpetroleumcompanies’CSRinitiatives.77
AlthoughtheGoMhasdisplayedsomelevelofcommitment,andtakensomesteps
towardscreatingaclimateinwhichthegascanbeusedfordevelopment,manyissues
stillneedtobeaddressedbeforethecountrycanbeseenasfullypreparedforthestart
ofproductionintheRovumaBasin.Manykeydecisionsmustbetaken;todosowill
requireafullunderstandingoftheimplicationsofpolicyoptions.Theseinclude,butare
notlimitedto,whethertheGoMwillreceiveitsroyaltiesandprofitshareingasorin
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cash;preciselyhowitwillusetheproceedsofgasproduction;whatkindofinvestments
ithasplansfortomakethegasrevenuesgofurther;whichgas-basedindustrieswillbe
supportedinutilisingthegasinternally;thefiscalregimeforthesector;andwhetherthere
willbeacontinuationofwhatarewidelyseenasexcessivetaxrebatesforso-called‘mega-
projects’–capital-intensive,infrastructure-driven,large-scaleprojectsmainlyinmining,
energyandindustry.78
Governance and corruption
Within Mozambique and beyond its borders there are perceptions that the level of
corruptioninthecountryishigh.Demandsforelectoralreformandimprovementsin
governancewereevident in theaftermathof the2009generalelections,whichwere
marredbyproceduralandadministrativecontroversies,79togetherwitha‘donorstrike’
in2010inresponsetowidespreadcorruptionandtheslowpaceofpositivechangein
governance.80AlthoughtheG-19renewedaidflowslaterthesameyear,inJuly2012
TheNetherlands announced that itwould stopGBS to theGoM from2013,due to
insufficientprogressinpovertyreduction,governanceandfightingcorruption81(albeita
decisionmadeagainstthebackgroundofadecliningaidbudgetinHolland82andadrop
ofalmost3%between2010and2011inofficialdevelopmentassistancefromtheOECD’s
DevelopmentAidCommitteedueinparttotheglobalrecession83).
Aftertwodecadesofrelativepeaceandstability,enviableeconomicgrowthratesand
somehumandevelopmentimprovements,‘Mozambiqueremainsacountryintransition’84
wheredonorsandcivilsocietyareevermorefrequentlyexpressinggrowingconcernover
slowprogresstowardsgoodgovernance,transparencyandtheeradicationofwhatthey
regardascorruption.
ManypoliticiansintheFrelimorulingpartyhavebeenlinkedtoprivatecompanies,
creatingasensethatpoliticalconnectionshavebroughtwiththemprivilegedpositionsin
theprivatesector.Expressingasimilarsentiment,RobertLloydarguesthat:85
‘economicgrowth,strongstateinvolvementintheprivatesector,inadequateadministrative
andjudicialoversight,andFrelimo’scontrolofthegovernmentsinceindependencehave
createdampleopportunityforprivategainatpublicexpense’.
According to Transparency International’s Corruption Perceptions Index 2011,
Mozambiqueranked120outof182countries,indicatingaprevailingperceptionofa
highlycorruptpublicservice.86Suchopinionsarefurthergivencredencebycivilsociety
organisations,which,representingthelargersocietalbase,decryboththeinvolvementof
politiciansinbusinessandanabsenceofsufficientpublicaccountabilityintheuseofstate
revenues.87Unsurprisingly,perceptionsofwidespreadcorruptionhaveledtoaconcern
thatwiththegasboomonthehorizonitisthepoliticaleliteandotherwell-connected
individualswhowillderivemostbenefitfromthecountry’shugenewresource,tothe
detrimentofthoseonthelowerrungsofthesocio-economicladder.88
Oneareaofparticularconcern,forexample,isthelackoftransparencycharacterising
theadministrationoftheSocialProjectFunds(SPFs)administeredbytheNPI.These
funds,whichalreadyamounttomillionsofdollars,arepaidbycompaniesintheextractive
sectorfromtheoutsetofexploration,forsocialupliftmentprojectsinexplorationareas.89
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AlthoughthereceiptofthesefundsisreflectedinEITIreports,questionshavebeenraised
astohowthegovernmentisusingthemoney,andtheaccountabilityandtransparency
mechanismsinplacetoensurethatthepublicbenefitsfromit.90Giventhattheamounts
alreadyspentonSPFsareonlyafractionoftheFDIinflowsthatthepetroleumsectorwill
seeinthecomingyears,thelackoftransparencyintheiradministrationisproblematic.
TheGoMhasputinplaceanumberofanti-corruptionmeasures,suchasthe2001
PublicSectorReformStrategy, anAnti-CorruptionLawpromulgated in2004, anda
CentralOfficeforCombatingCorruption,establishedin2005.Thereisalsoabroad-based
Anti-CorruptionStrategy,tofacilitatetheimplementationofwhich,amulti-stakeholder
Anti-CorruptionForumwascreatedbygovernmentdecree.Thisservedasaconsultation
platform for the Strategy (the Forum was later dismissed after the Constitutional
Courtdeclareditunconstitutional).Inadditionacodeofconductforpublicservants
wasestablished91andmostnotably,in2011theCouncilofMinistersadoptedananti-
corruption‘package’consistingofaseriesofbills.92Theselegislativedrafts,targeting
theprotectionofwhistle-blowers,promotingethicalconductandfurthercriminalising
corruptpractices,wereputbeforeParliamentinNovember2011.93Theintentionwasfor
thebillstobeadoptedalltogetherasa‘package’butatthetimeofwriting,Parliamenthad
passedonlysomeintolegislationandnotothers.
Hence,althoughstepshavebeentakentoaddresssomeofMozambique’spersistent
governancechallenges,institutionsthatcouldgiveeffecttotheselawshaveyettobe
granted sufficient powers to function. There is also limited co-ordination between
thosedifferentinstruments,whichfurtherhinderstheirabilitytoaddressgovernance
challenges.94
PetroleumLawNo3/2001isunderreviewandcurrentlybeforeParliamentasthe
PetroleumBill.Thereisarecognitionthatinordertoachievebestresultsinmaximising
governmentrevenues fromgasandachievingdevelopmentalpriorities,Mozambique
willhavetouseother,successfulcountriesasmodels.95TothisendENHandtheNPI
havebeenreceivingtechnicalassistanceintrainingandcapacity-buildingfromNorway.
Norwegianorganisationsarealsoworkingwithcivilsocietyinresearchinglegislativeand
environmentalaspectsoftheexploitationofnaturalresources.Inadditiontothisthe
WorldBankandthegovernmentofNorwayareprovidingassistanceoninvestigating
possibleusesofgaswithinMozambique,aprocesswhichhasculminatedinthereleaseof
afinalversionoftheMasterPlan.96
Mozambique’srecentcompliance intheEITIhasbeenhailed insomequartersas
majorleapforgreatertransparencyinthecountry’sextractivesector.97Thisoptimism
isnot,however,sharedbyallstakeholders.AcivilsocietyrepresentativeontheEITI
multi-stakeholderforumconsidersthat,whereasmanyimprovementshadbeenmadein
theprocessleadinguptocompliance,theEITIhasonlylimitedreach.Heconsidersthat
holdingarecordofpaymentsandreceiptsdoesnotpersetranslateintoaccountability.The
EITIshouldmovebeyonddocumentingpaymentsandreceiptstowardsactivelypromoting
accountabilityintheutilisationbygovernmentofextractiveindustryrevenues.98There
havebeencalls,mainlybycivilsociety,toextendthetermsofreferenceoftheEITIto
includenon-monetarypaymentsbycompaniestothegovernment,inthehopethatthis
measurewouldenablegreatermonitoringofextractiveindustrypaymentsincashand
alsoinkind(suchasextractiveproduct).Requestshavealsobeenmadeforgovernment
topublishcontractssignedbetweencompaniesandtheGoM,whichatthemomentare
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consideredconfidentialandarevirtuallyinaccessibletothepublic.Theaimistoimprove
accesstoenablecivilsocietytomonitorwhethercompaniesareinfactmeetingtheir
paymentcommitmentsinlinewiththeircontractualobligations.
Asastartingpoint,however,Mozambique’scompliancewithEITIshowsaserious
commitmenttotransparencyandcoupledwiththeinitiativestheGoMhasundertakento
addresscorruptionandpoorgovernance,thereispotentialforawell-governedpetroleum
sector.
n A t I o n A L d e v e L o P m e n t P o L I c y A t t h e c r o S S r o A d S
Mozambiquehasprimarilyfocusedontwobroaddevelopmentalstrategies:first,using
donoraid fordevelopmentprogrammesandprioritiesasnotedearlierandsecondly,
promotingmacro-economicgrowththroughdeployingexportrevenuesinstatepriority
areas.TheGoMhasfavouredthemega-projects,justifyingthemonthebasisthatthey
attractFDI,generateemploymentandcontributetothenationalfiscus,mainlythrough
exportearnings.99Partoftherationaleisalsothatmega-projectsfuelentrepreneurial
opportunitiesthroughtheestablishmentofsupportivesmall-andmedium-scalebusinesses
alongsidethelargerinvestmentprojects.Inaddition,theystimulatetheeconomyintheir
immediatelocalitythroughlocalprocurementandpromoteCSRinitiativesthatallow
communitiestobenefitdirectlyfromeconomicdevelopment.100
Thefirstofthemega-projectswastheMozalProject,a$1.4billionaluminiumsmelter
located20kmwestofMaputo,promotedbytheGoMinthelate1990sasavehicleto
attractforeigninvestment,andstronglysupportedbytheSouthAfricangovernment.101
Theprojectwasannouncedjointlyin1998bySouthAfrica’sIndustrialDevelopment
Corporation (IDC), theGoM,UK-baseddiversified resourcescompanyBHPBilliton
andMitsubishiCorporationof Japanaspartners and shareholders in theproject. It
wasconsideredasuccess,asconstructionwascompletedaheadofscheduleandwithin
budgetand theworkcreated10 000 indirect jobsand1000direct jobs,mostly for
Mozambicans.102Mozalalsofacilitatedexport-orientatedinfrastructuraldevelopments
includingroadconstruction,abridgeandanewberthatMatolaPortinMaputo.Other
spinoffscameintheformofCSRinitiativesthattargetedsocialandcommunityissues
suchasHIV/Aids,malariainfection,inadequateaccesstoschooling,healthcare,sport
and culture,highunemployment,poor small businessdevelopment and inadequate
communityinfrastructure.103Thesuccessfulconstructionofwhatatthetimewasthe
country’s largest private investment project, and commencement of operations in
September2000,madeforamajorboostforMozambique’spost-warimage,indicatingto
theworldthatMozambiquewaspeaceful,stableandreadytocapitaliseonFDI.
FollowingMozal,theGoMhaspromotedfurtherinvestmentinmega-projectsasone
ofitskeygrowthstrategies.Intheearly2000sitawardedpetroleumrightstoSasolforgas
developmentinPandeandTemaneandforitspipelinetoSouthAfrica.Thiswasfollowed
bythesigningofanagreementwithLondon-listedKenmareResourcesfordevelopmentof
theMomamineralsandsmineinNampulaProvince104andamajorinvestmentdealwith
BrazilianminingcompanyValeSAfortheexplorationandsubsequentproductionofcoal
atMoatize.105Sincethen,numerousminingconcessionshavebeenawarded,particularly
incoal-richTete,andexplorationforgasresourcescontinuesinthenorthernRovuma
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Basin.Whilenotalltheseschemesmayturnouttobemega-projects,thesizeofmanyof
theconcessionsindicatesthatcertainlytheywillbecomelargeinscale.
Thesocio-economicbenefitsthattodatehaveaccruedfrommega-projects,mainly
MozalandSasol’sgasventure,havebeenpresentedbythegovernmentasevidenceofa
successfuleconomicmodel.Thishasnot,however,passedwithoutcriticismfromwithin
andbeyondMozambique’sborders.Mega-projectsbytheirnaturerelyona‘trickle-down’
approachwhichassumesthatexportrevenueswillcontributetothenationalfiscusand
createopportunitiesformorebusinessesandindustries,whilecreatinglocallinkagesand
productsandservicessupportiveofthe‘anchor’project.Afurtherassumptionisthatthe
revenueswillbeusedbygovernmenttodevelopthecountryasawhole.Basedonthese
twoassumptionsitisarguedthatrevenueseventuallywillpercolatethroughtoalleviate
povertyandincreaseaccesstohealthcareandeducationamongotherpriorities.
Whilethismodelisnotnecessarilydoomedtofailure,inMozambiqueithasnotyet
liveduptoitspromise.ExceptwheretheGoMcommercialinterestsarerepresentedbya
nationalcompany–suchasENHinthepetroleumsector–themega-projectsareowned
primarilybyforeignentities.Theyarecapital-intensiveanddemandhigh-levelskillsthat
forthemostpartmustbeimported,eitherfromthehomecountriesoftheoperating
companiesorMozambique’sneighbouringcountries.106Thecompaniesexportthebulk
ofproductmainlyintheirprimaryformwithnovalueadded,resultinginlostpotential
foradditionaldomesticjobcreationandbusinessopportunities.107Thebenefitsofmega-
projectssofarhaveeludedthepoorestMozambicansandhaveonlymarginallyimproved
thelifeprospectsofcommunitiesintheprojects’immediatelocality.108Ina2011country
riskanalysisonMozambique,theDutchbankinggroupRabobankarguesthatalthough
mega-projectshaveapositiveeffectontheeconomytheydonotcreatemanyjobs,but
instead‘leadtoenrichmentofthehappyfew,whilemanypeople[remain]unemployed’.109
Thefailureofmega-projectstoliveuptotheirpotentialhasbeenaggravatedbytheGoM’s
inclinationtoincentivisethemwithlargetaxbreaksandimportexemptions.
AsMozambiqueenterstheneweraofagasboom,indicationsarethatmega-projects
willcontinuetofeatureinnationalpolicyandthatlargeforeigncompanieswillenjoya
relativelyfavourablefiscalandtaxregimedesignedtoattractevengreaterinwardfinancial
flows.Thisisregardedbysomeobserversasalarming,giventhatprojectsinthegassector
arelikelytofallwithinthe‘mega’categoryduetotheirlargeinvestmentandinfrastructural
requirements.Therehasbeenrecognition,however,thatsomechangesmustbemadeif
Mozambiquewishestoachievegreaterbenefitfromeconomicactivitieswithinitsborders,
particularlythoseintheextractivesector.Recognisingthatmanycontractsunfavourable
toithavealreadybeensignedwithprivatefirmsinvolvedinmega-projects,someinthe
extractivesector,theGoMisseekinglegislationtoremedyinequitablebenefitsaccruingto
thecompaniesinvolved.Inaparliamentaryaddressdefendingtheneedtorenegotiatesuch
contracts,FinanceMinisterManuelChangesaidthatthereisaneedtoachieve‘amore
significanteconomicandfinancialcontributionfromtheundertakingscarriedoutinthe
nationalterritory’.110Inlinewiththissentiment,civilsocietyorganisationsinMozambique
havealsobeenadvocatingareassessmentofthefinancialtermsandconditionsunder
whichmega-projectsingeneraloperate.Theyarguethatthroughcontractsthatconfer
disproportionatelyfavourabletaxconditionsonoperatingcompanies,Mozambiquedoes
notreceiveequitablebenefitfromoperationswithinitsborders.111
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G O v E R N A N C E O f A f R I C A ’ S R E S O U R C E S P R O G R A M M E
Thepromulgationofanewlawthatpermitsrenegotiationofcontractsmayensure
thatcorporations,thestate,thenationaleconomyandlocalcommunitiesderivemore
equalbenefitfrommega-projects.112Itisnotenough,however,forsuchalawtoexist
merelyonpaper.TheGoMwillhavetoshowitscommitmenttorightingmanyofthe
wrongsinherentinmega-projectsbygivingeffecttoitsexpressedintentionsandactually
negotiatingchangestocontractualclausesthatunfairlydisadvantagethegovernmentand
itspeople.AgainstthebackgroundoftheboominMozambique’sextractivesector,and
giventhatmanyoftheseminingandgasschemesbyvirtueoftheirsizeandinvestment
contributionswillbeclassifiedasmega-projects, it is importantthatthegovernment
demonstratesitscommitmenttoequityinfuturenegotiationsformega-projectsbymoving
aheadwiththelegislation.Thiswillnotonlysetthetoneforwhatistocome,butwill
haveanimmediate,positiveeffectonMozambicansingeneral.
The belief that there is a need to renegotiate the terms of some mega-projects
demonstrates a desire to address some of the shortcomings of the ‘trickle-down’
developmentmodel.Giventheincreasingcommercialinterestinthecountry’snatural
resourcewealthanditseconomyingeneral,theGoMisboundtoseeastrengtheningin
itsnegotiatingposition,buttheextentofamendmentstothetaxationregimeandfiscal
incentivestoattractFDIshouldnotbeoverstated.Asyet itremainsunclearhowfar
theGoMwillgotoincreasedirectstaterevenuesfrommega-projects,includingthose
intheextractivesector;especiallyifsuchactionisseenaspossiblysettingatrisksteady
FDIinflowsandcontributingtoanunfavourableinvestmentclimate.Althoughadelicate
balancehas tobestruckbetweenattracting foreign investorsandensuringequitable
benefits for government and society, in reality these twin priorities are not always
compatibleandindeedattimescanbetheopposite.ItiscrucialfortheGoMtostrikethe
correctstrategicbalancebetweenthem.Thisisparticularlyimportantinthecontextof
growingresourcenationalisminAfrica,whereincreasingly,citizensaredemandingthat
theyreceivegreaterbenefitfromexploitationoftheircountries’naturalresources,which
theyconsidernationalassetstobeusedfornationaldevelopment.
G e t t I n G t h e S t r A t e G I c b A L A n c e r I G h t
Accesstoenergyisoneofthemostimportantvehiclesforpovertyalleviationandoverall
economicgrowth.AlthoughMozambiqueenjoysamyriadofprimaryenergysources
includingcoal,naturalgas,hydroandwindpower,atpresentonly18%ofhouseholds
inMozambiquehaveaccesstoelectricity,withthegreatmajorityofMozambicansreliant
oninformalenergysourcessuchasbiomassandwood.113Recentgasdiscoverieshold
thepotentialtoalleviateenergypovertybymakingavailableaformalsourceofenergy
forhouseholdsandbusinessesalike.TheexecutivesummaryoftheMasterPlanDraft
Reportidentifiesvariousscenariosforutilisationofthegas,presentingoptionsavailable
totheGoMandcompaniesoperatinginthehydrocarbonssector,ratherthanlayingdown
ablueprintwhichparticipantsmustfollow.Theoptionsareinformedbyawiderange
offactors,includingestimatedgassupplyandproductioncosts;identifiablemarkets,
employmentgenerationcapacity,environmentalimpactsandvalueadded;andwaysin
whichthegaswindfallcanbestaddresssocio-economicchallenges.114
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Broadly,twooptionshavebeenidentifiedfortheRovumaBasindiscoveries.Tomake
gasproductionintheBasincommerciallyviablethedevelopersplantoexportthebulk
asLNG–presumablyatmarketprices–whiletheGoMplanstouseroyaltygasandthe
profitshareallocatedtoENHtodevelopgas-basedindustry.AnadarkoandENIintendto
constructanonshoreLNGprocessingplantinitiallyincludingtwotrains(withtheoption
ofanincreaseto10trainseach)andwithacapacitytoprocessfivemilliontonnesofgas
annually.115
Theremainingoutputwillbeusedtodevelopgasindustries.Inanalysingpossible
usesforthegaswithinMozambique,theMasterPlanexecutivesummaryconsiderstwo
sectors.Thefirstissmallandmediumenterprises(SMEs)whichusenaturalgasasprocess
heatintheirindustrialandcommercialoperations,includingasfuelfortransport.These
undertakingsarenotcompelledtolocateclosetothegassourceandwillusethegas
onlyifitiscommerciallycompetitive.116Thesecondsectorcompriseslargeindustrial
customerswhichusegas either as a feedstock inmanufacturingor asprocessheat.
Feedstockindustriesincludeproductionoffertiliser(urea),methanolandgas-to-liquids.
Process heat uses include power generation, aluminium smelting, steel production,
petrochemicalsandrefining,117knownas‘anchorloads’duetothevolumesofgasused
andthepipelineinfrastructureneededtomakeproductionviable.Suchindustriestendto
locateclosetothesourceofthegasbecauseenergyuseistheirprimaryinputandmajor
costofproduction.118Venturessuchastheseconventionallywouldbecharacterisedas
‘mega-projects’inMozambique.
GiventhatitisalreadybeingproducedincommercialquantitiesbySasolinthePande
andTemanefields,interesthasalreadybeenshowninusinggasforpowergeneration.
Mozambique’sfirstgas-firedpowerstationbeganoperatinginJuly2012withaproduction
capacityof107MW.119Sasolhassinceenteredintoajointventurewiththestate-owned
powerutilityElectricidadedeMoçambiquefortheconstructionofa140MWgas-fired
powerplantatRessanoGarcia,MaputoProvince,expectedtocomeonlinein2014.120
TheRovumaBasindiscoverieshavealsopromptedSouthAfrica’snationaloilcompany,
PetroleumOilandGasCorporationofSouthAfrica(PetroSA),toapplyfora licence
tobuildagas-to-liquidsfacilityinMozambique.121Variouscompanies,mainlybasedin
JapanandGermany,haveapproachedENHregardinggassuppliesforproposedmethanol
andfertiliserindustrialplantsandaMozambicancompanyhasputinanapplicationfor
apipelineproject.122Althoughthislistisnotexhaustive,theinitiativescitedgotoshow
thatgasproductionhasrealpotentialtocontributetojobcreationandeconomicgrowth
aswellastoenergysecurityinMozambiqueandtherestoftheregion.
Oneway for theGoMtouse thenewlyestablishedgas industry toaddresssome
of Mozambique’s socio-economic challenges is by encouraging the growth of SMEs
thatcanprovidesupportingservices toanchor industries. In thisway, theGoMcan
supporta‘bottom-up’economicgrowthmodel;suchsmallerenterpriseswillcontribute
totaxrevenues,increaseemploymentandprovideamarketforgastobeusedintheir
operations.Thepetroleumindustry,however,isveryspecialisedanddemandsahighly
skilledworkforce,whichatpresentMozambiquedoesnotpossess.TheGoMwillhaveto
investinalong-termskillsinitiativewithuniversityeducationandartisanaltrainingas
twoofitscentralpillars.Apracticalgoalforthisshouldbethatovertimetheindustry
employsamajorityofMozambicansratherthananexpatriatetechnicallabourforce.
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G O v E R N A N C E O f A f R I C A ’ S R E S O U R C E S P R O G R A M M E
The GoM should also ensure that revenues from natural gas (and other natural
resources)areusedtodiversifytheeconomybyinvestinginagricultureandfisheries,
amongother sectors. Suchdiversificationwill protect the future economy from the
shocksnormallyexperiencedinthenaturalresourceexportmarket,whilealsoboosting
thosesectorsmostclosely,andtraditionally,associatedwithsustainablelivelihoods.Itis
importantthatthepopulationatlargecantapintothenaturalgasreserves.According
totheMasterPlanDraftReportexecutivesummary,apipelineinfrastructure,although
expensive,isamorecost-effectiveoptionthanaseriesofLNGfacilitiesalongthevarious
ports in thecountry. Itwill alsoserve toencouragesmall-scale industriesproviding
servicestomega-projects,whichinturnshouldhaveasnowballeffectonjobcreationand
economicgrowth.123
Export of LNG and development of a gas-based industry within Mozambique
shouldnotbeseenastwoseparateoptionsthatcannotworkintandem.TheGoMmust
necessarilypursuebothstrategiesifitistomaximisethepotentialbenefitsofthegas
discoveries.Inadditiontotheadvantagespreviouslycited,agas-basedindustrywould
boostMozambique’sexportsintheimmediateregion.Crucially,gas-to-powerplantscan
servethecountry’selectricitygenerationdemandswhilealsobeingusedtoexportsurplus
electricitytotheSouthernAfricacommonpowergrid.Furthermore,naturalgasisflexible
inapplicationandcanalsobeusedasaformalenergysourceforhouseholds,replacing
moreinefficientinputs.
Given theseconsiderations it is important that theGoMstrike the rightbalance
between the quantities of gas exported and the amount retained. It is a foregone
conclusionthatthebulkoftheresourcewillbeexported:theGoM,however,mustensure
thatit isabletonegotiateanequitableshare, incashorkind,withwhichtoaddress
pressingdomesticneeds.
t o W A r d S A f u t u r e o f G A S P r o d u c t I o n
AlthoughMozambiqueisnotnewtothegasindustry,thescaleoftheRovumaBasin
deposits,aswellasthepotentialofnewfieldstobelicensedinthenextlicensinground
expectedinin2013,makesitnecessarytorevisitexistinggovernancestructuresforthe
industry.AlthoughtheprojectedstartdateforRovumaBasinproductionmayappearfar
off,itisimportantthatgovernmentbeginstheprocessofsigningcontractsandputting
inplacelegislativeandregulatoryframeworksandinstitutionsforafutureoflarge-scale
gasproductionandexport.TheurgencyisnotlostontheGoM,asisindicatedinthe
commentbyaseniorofficialintheMinistryofPlanningandDevelopmentthat‘thegas
inRovumaneedsafastapproachifMozambiqueistogetthemostoutof[it].Contracts
needtobesigned;companiesareanxioustogetstarted’.124Thissenseofurgencyshould,
however,bebalancedwithenoughcautiontoavoidhastydecisionsthatwillprejudice
governmentandcitizensonceRovumaBasinproductionbegins.Itisalsoimportantthat
decisionsarebasedonasoundunderstandingofthesectoranditspotential,andofthe
demandsofthelargereconomy.
TheGoMhascertainlytriedtogetafirmerhandleonthegassector.AccordingtoDr
BiasthereviewofthePetroleumLawnotedabovecarrieswithittheintentiontodevote
‘extracaretodomesticinterests’andinvolvelocalcompaniesparticularlyintheprovision
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ofgoodsandservices.125Article6oftheLawestablishesthatallpetroleumresourceswithin
Mozambicanterritoryarethe‘property’ofthestate.UnderArticle8thestatehassecured
directinvolvementinthesectorthroughENHwhich,asnotedearlier,hasashareholding
ineachoftheexplorationblocksaswellasinSasol’sexistingfields.ThePetroleumLaw
asitstandsalsoprovidesforproceduresinawardingcontracts;environmentalprotection
onceactivitieshavebegun;thefiscalregimegoverningthesector;anddisputeresolution
mechanisms.126ThePetroleumBillpresentlybeforeParliamentmakesacrucialaddition
thatmayhavesomelastingeffectifadministeredeffectively:Article7providesthatan
unspecifiedpercentageofthe‘incomegeneratedfromPetroleumOperationsischannelled
towardsthedevelopmentofcommunitiesintheareasinwhichPetroleumOperationsare
conducted’.127Interestingly,unlikepresentlegislationthedraftamendedPetroleumLaw
doesnotencompassthepetroleumsector’sfiscalregimealthoughitmightbethoughtthat
stipulatingthatregimeintermsoftax,royaltiesandotherpaymentsduetotheGoM,is
crucialtosoundfinancialmanagementofthesectoraswellastoenvironmentalstability
andestablishingalevelplayingfieldamongparticipants.Taxationlevelsmustnotbeso
highastodeterinvestment,butnotsolowastounfairlydisadvantagegovernmentand
society.ThisisabalancethatmustbecarefullynegotiatedbytheGoMinitsquestto
regulatethesectorinsuchawaythatitremainsattractivetoforeigncapital,whilemaking
ameaningfulandequitablecontributiontothenationaleconomy.
Within the extractive sector there are indications that the GoM is committed
to ensuring good governance and equitable benefit for society, indicated through
collaborativeeffortstobuildcapacityandenactlegislationbetweenMozambicanstate
officials,theWorldBankandotherdonoragencies.Ithassetupaninterdepartmental
steeringcommitteetooverseetheprogressoftheMasterPlanthroughtocompletion,
whichsignifiesitsintenttoinvestigateoptimalwaystousetheresource.Co-operation
betweendepartmentsinmattersofpetroleumlicensingalsoassistsinstreamliningthe
processandensuresthatallrelevantissuesaretakenintoaccount.TheCSRstudy,the
reviewofexistinglegislation,andcompliancewithEITIallindicatethattheGoMistaking
stepstowardsensuringgoodgovernanceinthenaturalresourcessector.
While the discourse within government circles, as well as some actions such as
legislativereform,encourageapositiveoutlook,notallstakeholdersinMozambiqueare
optimisticaboutthelikelycontributionofgastonationaldevelopment.Thereisaconcern
thatthecountrywillnotbeabletoputinplacetherequisitegovernanceandmanagement
structures in time for the signing of production contracts and the start of Rovuma
Basinextraction.Somestakeholdersevendoubtwhetherthereisarealcommitmentto
thisend.CivilsocietyhasquestionedwhetherMozambique’sEITIcompliancewillbe
effectiveineliminatingthediversionofresourcerentsfromstatecoffers,giventhatfunds
canbechannelledawayatstagesprecedenttothosemonitoredunderthestandard.128
Contractsbetweengovernment andbusiness enterprises in extractive industries are
confidentialdocuments,whichmakes itnear-impossible forcivil society tomonitor
whethercompaniesarerenderingthetaxestheyshouldunderlaw.Evenincaseswhere
companieshavebeengrantedfavourableconditionsitisdifficulttomonitorwhetheror
nottheyarepayingtheamountstipulatedintheircontracts–acrucialconcerninlightof
theargumentthatMozambiquehastendedtogivefavourabletermstoforeigninvestors,
whicharedifficulttorenegotiatewithoutcompromisingthecountry’sreputationabroad.
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G O v E R N A N C E O f A f R I C A ’ S R E S O U R C E S P R O G R A M M E
Parliament and civil society have an important role to play in ensuring that
developmental policies are adopted, implemented and adhered to. The role of the
legislativeassemblywillhavetobestrengthenedifitistoperformaseriousroleinholding
governmenttoaccount,ataskthatmaybelessthaneasygiventhatFrelimoholdswell
overtwo-thirdsoftheseatsintheassembly.Mozambique’scivilsociety,too,hasalways
beenweak,under-fundedandunco-ordinated.Thereisgreatpotentialforastrongand
unitedcivil societymovement to lobby for thechangesnecessary toensure thatgas
developmentbenefitsthebroadersociety.IndependentmediainMozambiquearewidely
consideredfreebutlack‘coverage,capacityandfunding’andengageinself-censorshipdue
tofearofbeingtakentocourtbygovernment’.129Thisisanotherproblemthatmustbe
correctedifthemediaaretoplayaseriouspartinholdingthestatetoaccount.
Theindependenceofmonitoringagenciescannotbeover-emphasised;onlythrough
unencumbered autonomy can they can perform their functions effectively. For this
reasontheGoMmustcommititselftogoodgovernance,accountability,transparency
andintegritybyestablishingoversightinstitutionstopromoteandmonitoradherenceto
legislationinthepetroleumsector.WhiletheEITIgoessomewaytowardsthis,theculture
ofsecrecysurroundingcontractsbetweentheGoMandcompaniesinthesectorlimitsthe
informationthatcanbeaccessedbythoseinterestedinmonitoringlegislativecompliance.
FurthermorethelimitedscopeoftheEITI,whichmonitorsonlypaymentsandreceipts,
meansthatitshouldproperlybeseenasastartingpointratherthananendinitself.Given
thesubstantialincomestreamtheGoMisanticipatingasaresultoftheRovumaBasin
discoveries,preventionofinadequateoversight,whichcouldintimegivewaytoaculture
ofnon-complianceandevencorruption,iscritical.
Inregardtoaccountabilitythereshouldbeclearandopenlinkagesbetweentheuses
ofrevenuesbygovernment.ThePetroleumBillmakesprovisionforaportionofrevenues
toberemittedtocommunitiesinareaswherepetroleumoperationsareconducted.Thisis
astepintherightdirectionbutitisimperativethatlocalauthorities,whichwillbetasked
withadministeringthesefunds,havetheadministrativeandlegalcapacitytomeetthis
obligation.Itisequallyimportantthatthereshouldbemechanismsinplacetoeliminate
opportunitiesforrentcaptureandcorruptionatthelocallevel.Thiswillgosomewayto
ensuringthatfundsareusedappropriatelyforlocalcommunityneeds,avoidingasituation
inwhichrevenuesremainatthenationallevelduetolackofcapacityfurtherdownthe
line–ashasoccurredinthepast.
c o n c L u S I o n
InthepastfewyearsmajordiscoveriesofnaturalgasinMozambiquehavebroughtwith
themanatmosphereofpalpableeagernessandanticipation.Internationalcompanies
prospectingforgashavesuggestedthatFDIinflowsmayrunintobillionsofdollars.The
governmenthasindicatedthatitintendstousethiswindfallfornationaldevelopment,
ordinaryMozambicanshopeforachangeintheirsocio-economiccircumstances,while
civilsocietyisadvocatingacautiousapproach.Itisclearthatsomedecisivesteps(eg
legislativereform,variousstudies,bilateralpartnershipsandEITImembership)have
beentakentowardscreatingaregulatoryframeworkfornaturalgasproduction.Concerns
remain,however,aroundcorruptionandalackoftransparencyandaccountability.Donors
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andcivilsocietyorganisationscontinuetocallforgreatercommitmenttogoodgovernance
andtheeradicationofcorruption;ithasbecomeincreasinglyurgenttoaddressthese
shortcomingsifthegassectoristorealiseitsfullsocialpotential.
TheGoMshould regard theurgentdevelopmentalneedsofMozambiqueand its
peopleasitsprimaryconcern,andaccepttheimplicationsofsuchanapproach.These
wouldincluderevisitingunfavourablecontractsandgivingstatecontractnegotiators
enoughauthoritytoensurethatfuturecontractsinthegassectorarefairtoallparties.
Theargumentthatoverlylenientconditionsformega-projectsservetoattractFDIand
arethereforeofthemselvesgoodforthecountryinthelongrundoesnotholdwater
whentakenagainstMozambique’slowlevelofdevelopment.TheGoMmustunderstand
thatthegasdiscoverieshavecreatedasenseofhopeinMozambiqueandthathopes
frustratedcouldbringwiththemalevelofunrestandinstabilitydetrimentaltothepeace
andstabilitythatfosterinwardinvestment.Achievingsuchadelicatebalancedemands
firstandforemostapoliticalcommitmentonthepartofMozambique’selectedleadersto
improvingthecircumstancesoftheircitizensbydevisingpracticalandworkablestrategies
formaximisingthesocio-economicbenefitsaccruingfromthegasbonanza.
Wellmanaged,thegaswindfallcouldmoveMozambique’seconomysteadilyforward
bymakingthecountryanetexporteroftheresource;increasinggrowthratesevenfurther
andcuttingrelianceondonorfunding;itwillprovidetheprimaryresourceforalocalgas-
basedindustry,increaseenergyaccessforhouseholdsandbusinesses,andmakeavailable
moregovernmentfundsfordevelopmentprogrammes.
Whetherthiswillhappenafter2018willdependonmanyfactors.Amongthemare
GoMdevelopmentpolicies;thequalityoflegislationgoverningthesectorandtherigour
withwhichitisenforced;andtransparencyinmanagingrevenuesaccruingfromoperating
companies.Theremustalsobestringentaccountabilitystructures,strongmechanisms
dealingwithcorruption,andconsistentandunbiasedlegalrecoursewherelegislative
complianceislacking.
Mostimportantly,theremustbethepoliticalwillandcommitmentatgovernmentlevel
todistributethenewgasrevenuesinawaythatwillimprovethelotofMozambicansin
general.Atpresenttheyaresomeofthepoorestpeopleintheworld;butitmaybethat
theywillnotlongremainso.
e n d n o t e S
1 VermaN,‘MozambiquetooffernewblocksinQ12013-ministry’,Reuters,16October2012,
http://af.reuters.com/article/investingNews/idAFJOE89F01D20121016.
2 Personalinterview,seniorofficial,NationalDepartmentofMineralResources,Maputo,15May
2012;personalinterview,seniorofficial,NationalDepartmentofPlanningandDevelopment,
Maputo,17May2012.
3 ICFInternational,‘NationalgasmasterplanforMozambique:Draftreportexecutivesummary’
wassubmittedtotheGovernmentofMozambiqueSteeringCommittee26August2012with
thefulldocumentexpectedin2013.Thedocumentpresentsasummaryofoptionsavailable
inutilisingthegasasliquefiednaturalgasexportsorforlocalindustry.Itrecognisestheneed
tobenefitabroadbaseofsociety.
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4 Personalinterview,seniorofficial,NationalDepartmentofPlanningandDevelopment,Maputo,
17May2012.
5 BucuaneA&PMulder,‘ExpandingexploitationofnaturalresourcesinMozambique:Will
itbeablessingoracurse?’inDeBritoLet al.,(eds),Reflections of economic questions,papers
presented at the inaugural conference of the Institute for Social and Economic Studies.Mozambique:
IESE,2007,p.104.
6 IsmailK,‘TheStructuralManifestationofthe“DutchDisease”:TheCaseofOilExporting
Countries’,IMFWorkingPaper10/103.Washington,DC:InternationalMonetaryFund,April
2010,p.4.
7 IEA(InternationalEnergyAgency), ‘Goldenrules foragoldenageofgas’,WorldEnergy
OutlookonUnconventionalGas.Paris:IEA,2012,p.9.
8 Op. cit.p.10.
9 WrightS,‘Anunconventionalbonanza’,The Economist,14June2012,http://www.economist.
com/node/21558432.
10 CPI(CentreforInvestmentPromotioninMozambique),http://www.cpi.co.mz/;CIA(Central
IntelligenceAgency),Langley,https://www.cia.gov/library/publications/the-world-factbook/
geos/mz.html.
11 RasmussenHL,‘DonorsputbrakesonMozambiqueaid’,Mail and Guardian,1June2010,
http://mg.co.za/article/2010-07-01-donors-put-brakes-on-mozambique-aid.
12 BiasE,‘ExplorationandminingopportunitiesinMozambique’,presentation,MiningIndaba
2012,CapeTown,6–9February2012.
13 Ibid.
14 Personalinterview,Researcher,WWF(WorldWildlifeFund),Maputo,16May2012.
15 RibeiroD&JDimon,Oil or Development: Results from a field study on the environmental and
social impacts of oil exploration along the northern Coast,JustiçaAmbiental,September2011.
16 Personalinterview,researcher,WWF,Maputo,16May2012.
17 NoormahomedAR,‘OverviewofMozambique’snaturalgasandoilpotential’,Presentation,
Washington,DC,29November–1December2006.
18 NPI(NationalPetroleumInstitute),‘HistoryofpetroleumexplorationinMozambique’,http://
www.inp.gov.mz/Exploration-Production/History-of-Petroleum-Exploration-in-Mozambique2,
accessed10July2012.
19 Sasol,AnnualReview,Johannesburg:Sasol,2004,p.38.
20 Sasol,‘PresidentsChissanoandMbekiinauguratenaturalgasventureinMozambique’,Sasol
NewsCentre,1June2004,http://www.sasol.com/sasol_internet/frontend/navigation.jsp?articl
eId=8500001&navid=4&rootid=4,accessed10July2012.
21 Personalinterview,seniormanager,SasolMozambique,Maputo,17February2012.
22 EsterhuizenI,‘SasolopensexpandedgasprocessingfacilityinMozambique’,Engineering News
Online,30May2012,http://www.engineeringnews.co.za/article/sasol-opens-expanded-gas-
processing-facility-in-mozambique-2012-05-30.
23 NPI,Pressrelease,http://www.inp-mz.com/Press.htm,London,15July2005.
24 Pretorius,op. cit.
25 RepublicofMozambique,PetroleumLawNo3/2001of21February,p.6.
26 Personalinterview,seniormanager,EmpresaNacionaldeHidrocarbonetosdeMoçambique
(ENH),Maputo,15May2012.
27 Ibid.
28 Ibid.
M O Z A M B I Q U E ’ S N AT U R A L G A S & T H E N E W D E v E L O P M E N T O P P O R T U N I T Y
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29 Ibid.
30 AnadarkoPetroleumCorporation,‘Mozambique:Developingnaturalgas’,Texas:Anadarko,nd.
31 ICFInternational,‘NaturalgasmasterplanforMozambique:Draftreportexecutivesummary’,
Fairfax:ICFInternational,26August2012,p.1.
32 Ibid.
33 PlankD,‘Aid,debtandtheendofsovereignty:Mozambiqueanditsdonors’,Journal of Modern
African Studies,31,3,1993,p.409.
34 AbrahamssonH,‘Theinternationalpoliticaleconomyofstructuraladjustment:Thecaseof
Mozambique’,European Journal of Development Research,7,2,1995,p.313.
35 PlankD,op. cit.,p.411.
36 MarshalJ,‘StructuraladjustmentandsocialpolicyinMozambique’,Review of African Political
Economy,47,1990,pp.29–31.
37 PlankD,op. cit.,p.411.
38 USDepartmentofState,‘AbriefhistoryofMozambique,Part2:Theroadtopeace’,http://
africanhistory.about.com/od/mozambique/p/MozambiqueHist2.htm,accessed,23July2013
39 AfricanElectionsDatabase, ‘ElectionsinMozambique’,http://africanelections.tripod.com.
mz.html,accessed13July2012.
40 UNDP(UnitedNationsDevelopmentProgramme),ReportontheMillenniumDevelopment
Goals: Mozambique 2010, 28 February 2011, p. 6, http://undp.org.mz/en/Publications/
National-Reports/Report-on-the-Millennium-Development-Goals-Mozambique-2010.
41 DibbenP,‘Transport,tradeandeconomicdevelopmentinMozambique:Anagendaforchange’,
inDeBritoL et al.(eds),op. cit.,p.198.
42 AbrahamssonH,op. cit.,p.299.
43 ManningC&MMalbrough, ‘TheChangingDynamicsofForeignAidandDemocracyin
Mozambique’,UNU-WIDERWorkingPaper,2012/18.Tokyo:UnitedNationsUniversity,2012,
p.3.
44 ManningC&MMalbrough,op. cit.,p.4.
45 De Renzio P & J Hanlon, ‘Contested sovereignty in Mozambique: The dilemmas of aid
dependence’,ManagingAidDependencyProject,GEGWorkingPaper2007/25,Oxford:Global
EconomicsGovernanceProgramme,January2007,p.2.
46 Personal interview, senior researcher, IESE (Institute for Social and Economic Studies),
Maputo,16May2012.
47 Bruschi F, ‘Mozambique at a Turning Point: From Aid Dependence to Development
Effectiveness’,GREAT Insights,1,10,2012,pp.9–10.
48 InterviewwithPresidentArmandoEmilioGuebuza,Brussels,16December2012,GREAT
Insights,1,10,2012,p.1.
49 OECD (Organisation for Economic Co-operation and Development), Development: Aid
to developing countries falls because of global recession,4April2012,http://www.oecd.org/
newsroom/developmentaidtodevelopingcountriesfallsbecauseofglobalrecession.htm,accessed
18January2013.
50 Ibid.
51 Personalinterview,seniorresearcher,IESE,Maputo,16May2012.
52 Ibid.
53 DeRenzioP&JHanlon,op. cit.
54 DibbenP,op. cit.,p.199.
55 UNDP,op. cit.,p.7–8.
30
S A I I A O C C A S I O N A L P A P E R N U M B E R 151
G O v E R N A N C E O f A f R I C A ’ S R E S O U R C E S P R O G R A M M E
56 Personalinterview,seniorresearcher,IESE,Maputo,16May2012.
57 ManningC&MMalbrough,op. cit.,p.3.
58 AbrahamssonH,op. cit.,p.315.
59 DeRenzioP&JHanlon,op. cit.,p.4.
60 AndersonEJ,‘WhatdoeshydrocarbonwealthmeanforforeignaidinMozambique?’,Policy
Briefing50.Johannesburg:SouthAfricanInstituteofInternationalAffairs,2012.p.4.
61 AndersonEJ,op. cit.p.2.
62 UNDP,Human Development Report 2011,Sustainability and Equity: A better future for all,
Summary.NewYork:UNDP,2011,p.20.
63 UNDP,op. cit.,p.4.
64 RepublicofMozambique,ActionPlanfortheReductionofAbsolutePoverty2001–2005,
Strategy document for the reduction of poverty and promotion of economic growth,
Washington,DC:IMF,April2001,p.1.
65 RepublicofMozambique,PovertyReductionActionPlan2011-2014,Wasington:IMF,May
2011,p.7.
66 ‘MemorandumofUnderstandingbetweentheGovernmentofMozambiqueandtheProgramme
AidPartnersontheProvisionofGeneralBudgetSupport’,March2009,p.4,http://www.pap.
org.mz/others_reports.htm,accessed11July2012.
67 Ibid.
68 IMF,‘Debtreliefundertheheavilyindebtedpoorcountries(HIPC)initiative’,2April2013,
http://www.imf.org/external/np/exr/facts/hipc.htm,accessed23July2013.
69 RepublicofMozambique,PetroleumLawNo3/2001,op. cit.,p.1.
70 ICFInternational,op. cit.,p.3.
71 ICFInternational,op. cit.,p.2.
72 Ibid.
73 Personalinterview,seniorofficial,MinistryofMineralResources,Maputo,15May2012.
74 TheEITIisaninternationalstandardwhichaimstoenhancetransparencyintheextractive
sector,includingmining,oilandgas,throughthefulldisclosureoftaxandroyaltypayments
andreceiptsbycompaniesandgovernmentsrespectively,seewww.eiti.org.
75 Personalinterview,seniorofficial,MinistryofMineralResources,Maputo,15May2012.
76 EITI(ExtractiveIndustriesTransparencyInternational),Extractive Industries Transparency
Initiative, Second Reconciliation Report – Year 2009,Maputo,May2012,p.10.
77 Personalinterview,seniorofficial,MinistryofMineralResources,Maputo,15May2012
78 ICFInternational,op. cit.,pp.32–36.
79 ManningC&MMalbrough,opcit.,p.6.
80 RasmussenHL,op. cit.
81 Fin24,‘NetherlandsstopsbudgetaidtoMozambique’,13July2012,http://www.fin24.com/
Economy/Netherlands-stops-budget-aid-to-Mozambique-20120713.
82 ‘Report2012:Netherlands’,Brussels:AidWatch.http://aidwatch.concordeurope.org/countries/
project/netherlands/,accessed23August2012.
83 Tran M, ‘Drop in aid shows declining will for global partnership on development’, The
Guardian,20September2012,http://www.guardian.co.uk/global-development/2012/sep/20/
drop-aid-declining-will-global-partnership.
84 LloydR,‘CountriesattheCrossroads2011:Mozambique’,FreedomHouse.Washington,DC:
FreedomHouse,2011.
85 LloydR,op. cit.
M O Z A M B I Q U E ’ S N AT U R A L G A S & T H E N E W D E v E L O P M E N T O P P O R T U N I T Y
31
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86 Corruption Perceptions Index 2011. Berlin: Transparency International, 2011, accessed
8August2012.
87 Personalinterview,seniorresearcher,CentreforPublicIntegrity,Maputo,17May2012.
88 Ibid.
89 Personalinterview,researcher,WWF,Maputo,16May2012.
90 Personalinterview,seniorresearcher,CentreforPublicIntegrity,Maputo,17May2012.
91 Martini M, ‘Overview of corruption and anti-corruption in Mozambique’, Transparency
International,Anti-corruptionResourceCentre,5March2012,pp.8–9,accessed9August
2012.
92 PereiraPG&JCTrindade,‘OverviewandanalysisoftheAnti-corruptionlegislativepackage
ofMozambique:Findings’,Basel:BaselInstituteonGovernance,31October2011,http://
www.baselgovernance.org/fileadmin/docs/publications/commissioned_studies/Mozambique_
Findings.pdf.
93 MartiniM,op. cit.,p.9.
94 Ibid.
95 Personalinterview,seniorofficial,MinistryofMineralResources,Maputo,15May2012.
96 Personalinterview,seniorofficial,CommercialDepartment,ENH,Maputo,15May2012.
97 LeeR,‘Majorsteptowardsminingtransparency’,OpenSocietyInitiativeforSouthernAfrica,
28October2012,http://www.osisa.org/economic-justice/mozambique/major-step-towards-
greater-mining-transparency,accessed23January2013.
98 Ibid.
99 All Africa Global Media, ‘Mozambique:BenefitsofMega-ProjectsExplainedtoParliament’,
11April2012,http://allafrica.com/stories/201204111170.html.
100 ‘Mozambique:Planningministerdefendsmega-projects’,Pretoria:TradeMarkSouthernAfrica,
25 November 2010, http://www.trademarksa.org/news/mozambique-planning-minister-
defends-mega-projects,accessed10July2012.
101 Personal interview, senior commissioner, South African High Commission, Maputo,
Mozambique,16February2012.
102 ‘Casestudy:BHPBilliton–MozalAluminiumSmelterinMozambique’,Melbourne:Business
forMillenniumDevelopment,http://www.b4md.com.au/Files/MDG2_CaseStudy.pdf,accessed
10July2012.
103 Ibid.
104 BarradasS,‘Momatitaniummineralsandsproject’,Mining Weekly,7July2006.
105 Business Report,‘Valeopens$1.7bncoalmineinMozambique’,9May2011.
106 Sonne-Schmit C, Arndt C & M Magaua, ‘Contribution of mega-projects to GDP in
Mozambique’,paperpresentedatIIIESEConference,Maputo,22–23April2009,p.5.
107 Ibid.
108 Afrodad(AfricanForumandNetworkonDebtandDevelopment),‘Whathastaxgottodowith
development?AcriticallookatMozambique’staxsystem’.Harare:Afrodad,2011,p.9.
109 MeijerR,‘CountryReport:Mozambique’,Utrecht:Rabobank,October2011,p.4.
110 All Africa Global Media, ‘Mozambique: New bill envisages renegotiating megaprojects’,
11May2011,http://allafrica.com/stories/201105111043.html.
111 Personalinterview,assistantresearcher,IESE,16May2012.
112 All Africa Global Media,11May2011,op. cit.
113 Mahumane G, Mulder P & D Nadaud, ‘Energy outlook for Mozambique 2012–2030
LEAP-basedscenariosforenergy-baseddemandandpowergeneration’,paperpresentedat
32
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G O v E R N A N C E O f A f R I C A ’ S R E S O U R C E S P R O G R A M M E
Mozambique:AccumulationandTransformationintheContextoftheInternationalCrisis,
IESE3rdInternationalConference,Maputo,4–5September2012.
114 ICFInternational,op. cit.,p.2.
115 JansenR,‘Anadarko,ENIpushonwithMozambiqueLNG’,3January2013.London:TCE
Today,accessed30January2013.
116 ICFInternational,op. cit.,p.7.
117 Ibid.
118 Ibid.
119 Macauhub,‘RessanoGarciapowerplantinMozambiquetoopenonWednesday’,17July2012,
http://www.macauhub.com.mo/en/2012/07/17/ressano-garcia-power-plant-in-mozambique-to-
open-wednesday/.
120 CreamerT,‘Sasol,EDMsigncontractforRessanoGarciagas-firedpowerplant’,Mining Weekly,
13December2012,http://www.engineeringnews.co.za/article/sasol-edm-sign-contract-for-
ressano-garcia-gas-fired-power-plant-2012-12-13.
121 Fin24,‘PetroSAintalkswithMozambiqueonGTLplant’,25April2012,http://www.fin24.com/
Companies/Industrial/PetroSA-in-talks-with-Mozambique-on-GTL-plant-20120425.
122 ICFInternational,op. cit.,p.8.
123 ICFInternational,op. cit.p.21.
124 Personalinterview,seniorofficial,MinistryofPlanningandDevelopment,Maputo,17May
2012.
125 Aiogace(AngolaInternationalOilandGasConferenceandExhibition)2012,‘Utilisingand
identifyingnewoilandgasresourcesforthebenefitofAngola’sfuturegenerations’,Interview
withMozambicanMinisterofMineralResourcesEsparançaBias,Luanda,7–9May2012.
126 RepublicofMozambique,PetroleumLawNo3/2001,op. cit.
127 RepublicofMozambique,DepartmentofMineralResources,PetroleumLawReview(unofficial
translation).
128 OssemaneR, ‘Is theExtractive IndustriesTransparency InitiativeRelevant forReducing
DiversionsofPublicRevenue?TheMozambicanExperience’,PolicyBriefing,61.Johannesburg:
SouthAfricanInstituteofInternationalAffairs,2013.
129 ManningC&MMalbrough,op. cit.,p.15.
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