Chapo: 'We need to review contracts to guarantee the interests of the people'

Mozambique prepares to renegotiate megaproject contracts

The President of the Republic, Daniel Chapo, has announced that the Mozambican government intends to renegotiate the contracts of megaprojects that exploit the country's natural resources. According to Chapo, Mozambique has undergone significant changes in the last 20 years, both in terms of population and strategic interests and objectives.

"Mozambique is no longer the same as it was two decades ago. Realities, challenges and national ambitions have changed. So it's only natural that we revisit the contracts to ensure that they are in line with current needs," said the head of state at the end of his three-day visit to Nampula province on Saturday (29.03).

Chapo explained that, as happens in any country, contracts that come to an end need to be analyzed and adjusted before being renewed. "We are now discussing the renewal clauses so that the contracts reflect the country's current interests and don't just repeat the old terms," he explained.

One of the cases in point is the concession for the Moma mine, one of the world's largest producers of titanium and zircon. The contract expired on December 21, and the Australian mining company Kenmare continues to operate while negotiations with the government are underway.

The President stressed that this renegotiation process should not be seen as a delay, but rather as an effort to ensure that the new contracts serve the national interest. "We have contracts signed 20 years ago, such as those for Mosal (steel), Sasol (hydrocarbons, in Inhambane) and Kenmare (heavy minerals, in Nampula). We need to re-evaluate them," he said.

On the specific case of Kenmare, Chapo stressed that there are interests at stake for both parties, such as social responsibility obligations and local content. "The company is defending its interests and we, as a government, are defending those of the Mozambican people. This negotiation takes time, but it takes place peacefully," he said.

The President assured that at any moment the Kenmare contract will be submitted to the Council of Ministers for approval, provided that both parties are satisfied with the new terms. In the meantime, the mining company is continuing its operations as normal. "There is no stoppage, because this is a smooth negotiation with no conflicts," he emphasized.

Recently, Kenmare announced that its profits in 2024 fell by 50% to 64.9 million dollars (60.2 million euros). The company also revealed plans to expand its operations at Moma, foreseeing the exploration of a new lode in the next two years.

Exports from the Moma mine grew by 4% last year, reaching 1,088,600 tons of minerals, including heavy sands, zircon, ilmenite and rutile, with the highest volume of shipments in the second half of the year.