Mozambique’s minister of mineral resources and energy has said that South African multinational company Sasol “is obliged” to create jobs and business opportunities for Mozambican companies in its natural gas projects in Mozambique.
“The government has approved the project development plan [for natural gas production to start in 2024], and one of the components in which Sasol is obliged to comply is the development of local content,” Max Tonela said.
Tonela was speaking to the media after visiting sites where the South African petrochemical company is opening up new wells and refurbishing old ones for natural gas extraction in the Pande and Temane fields in Inhambane province, southern Mozambique.
Under a new Production Sharing Agreement with Sasol, the Mozambican government wants the company to hire more local labour and promote more opportunities for Mozambican companies.
“We have agreed that in the next three years, the level of participation of Mozambican companies in the opportunities created by Sasol should rise from 50% to 70%,” he noted.
The source said that the company has also opened a credit line with the national bank in favour of companies that will provide goods and services to the new natural gas development project in Inhambane province.
The company, he said, would also step up technical and professional training of local workers to allow the youth of Inhambane province to have access to jobs.
Tonela said that the government and Sasol had today started regular meetings to monitor the degree of compliance with the company’s commitments under the so-called “local content,” a concept that defines labour and business opportunities for Mozambicans.
The governor said that greater commitment from multinationals in the extractive industry would be an essential contribution to mitigating “tensions” between companies and communities living in the areas where megaprojects are being implemented.
“The populations demand a more direct and more visible contribution that the project should leave in the area of implementation,” he said.
In July this year, a group of young people from Inhassoro district, where Sasol operates, blocked the National Highway 1 (EN1) for a few hours in protest against the alleged exclusion of local communities.
Sasol’s ventures in Mozambique will power the largest thermal power plant to be built in the country with 450 megawatts, an electricity transmission line between Inhambane and Maputo of over 560 kilometres and three substations costing over US$600 million (over 510 million euros).
Tonela noted that the project would also include the production of cooking gas, favouring new relationships between companies and value chains.
In the construction phase, Sasol’s new venture will employ up to 6,500 workers and in the operation stage 714 jobs.
Construction of Sasol’s new project in Inhambane will finish in 2024, with natural gas production starting that year.
Sasol has been operating gas reserves since 2004 in Temane and Pande with pipelines to South Africa and Maputo and feeding Mozambique’s Ressano Garcia power plant near the capital and on the border with South Africa.