By: Ecofin agency

Mozambique's President Daniel Chapo has called for a shift in how the country manages its natural resources, saying energy and mining projects must deliver broader economic benefits instead of serving mainly as export industries.

Speaking at the 12th Mozambique Mining and Energy Conference (MMEC 2026), held May 6-7 in Maputo, Chapo said the country was moving beyond an extractive economic model.

“We are definitively moving away from a resource-extraction model and entering a phase of economic and social transformation for all Mozambicans,” he said, according to Club of Mozambique.

Chapo said each resource project should generate tangible benefits for the country beyond raw material exports. The strategy is backed by reforms to the legislative framework governing the mining and hydrocarbons sectors.

Since taking office in January 2025, Chapo has pledged to restructure both industries to increase local economic participation and strengthen industrial development.

“The main objective is to turn the country’s natural resources into sustainable drivers of development,” he wrote in a letter accompanying a proposed revision of the mining law, according to local media reports.

The draft legislation includes incentives for domestic processing of raw materials and measures aimed at increasing the participation of Mozambican companies in mining and energy value chains.

In the gas sector, authorities see the restart of major LNG projects as a key part of that strategy. When the Mozambique LNG project resumed in January, TotalEnergies said contracts awarded to local companies were expected to exceed $4 billion. The company also said up to 7,000 direct jobs for Mozambicans could be created during the construction phase.

Despite its vast natural resource wealth, Mozambique continues to face major economic and industrial challenges. The country ranked 113th out of 191 countries in the United Nations Development Programme’s 2023 Human Development Index, despite holding some of Africa’s largest gas reserves.

According to the U.S. Energy Information Administration, the Rovuma Basin contains more than 100 trillion cubic feet of natural gas reserves, the largest discovered in East Africa. Mozambique is also the world’s third-largest graphite producer and has significant coal and titanium reserves.

However, Mozambique still struggles to retain large industrial investors. Last month, South32 shut down the Mozal aluminum smelter, the country’s only major industrial electricity consumer, after six years of unsuccessful negotiations over power supply costs, Ecofin Agency reported.

The closure led to about 5,000 job losses and affected one of Mozambique’s largest industrial employers. According to South32, Mozal accounted for around 30% of the country’s manufacturing output and more than 3% of gross domestic product.

Against that backdrop, the restart of the $20 billion Mozambique LNG project — suspended since 2021 because of jihadist attacks in Cabo Delgado province — was presented at MMEC 2026 as an important signal of renewed investor confidence.