Mozambique must guard against global natural gas over-production – Chairman of ENH

Mozambique must find an effective sales strategy for its natural gas against a background of world over-production, the chairman of ENH, the company that controls the Mozambican state’s holdings in the mining and industry, has said.

Omar Mithá highlighted challenges in the global gas market when speaking at the Mozambique Gas Summit taking place since Wednesday in the Mozambican capital.

“The US has gone from being an importing country to a natural gas exporter and will now enter the new production cycle, and Qatar has already lifted the moratorium it had imposed on producing more gas,” Mitha said.

Despite competition from other producers, Mozambique would be able to impose itself as a world power in natural gas, according to the chairman of ENH (Empresa Nacional de Hidrocarbonetos).

The final investment decision announced earlier this year by the consortium led by Italy’s ENI for Rovuma Basin Area 4 in northern Mozambique was a sign that industry players trust the potential of Mozambican gas, Mithá added.

“With the final investment decision of ENI we already have a concrete project,” he said.

Advances secured between the government and the US-led consortium Anadarko toward a final investment decision in Area 1 of the Rovuma Basin also consolidate optimism about the future, he emphasised.

Mithá stressed that the country must prepare to maximise the benefits of natural gas production in the Rovuma Basin, ensuring the participation of Mozambican companies and workers in the development of natural gas and related projects.

The vice president of the Confederation of Economic Associations of Mozambique (CTA), the country’s largest employers’ association, Álvaro Massingue, emphasised the need to involve local entrepreneurs in gas projects as a way of keeping the benefits in the country.

“We see the need for the National Content Law to be designed to create a provision for the mandatory participation of national capital in the companies involved in the extractive industry on commercial terms and conditions,” he said.

To this end, the CTA on September 8th launched a Business Support Office (GAE) to help domestic companies acquire accreditation for the supply of goods and services to large extractive industry companies.

“We believe that this intervention will reverse the current poor access of domestic companies to the opportunities generated by the extractive sector,” Massingue said.

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