Australian-based diversified mining group South32 has placed its Mozal aluminium smelter near Maputo into care and maintenance after failing to secure adequate and affordable electricity beyond March 2026, a decision that raises the prospect of job losses and reduced export earnings for Mozambique.
The company said the shutdown followed prolonged negotiations with Mozambican authorities and power utilities that failed to secure a viable long‑term electricity agreement.
“Over the past six years we have engaged extensively with the Government of the Republic of Mozambique, Eskom and other key stakeholders but were unable to secure sufficient and affordable power supply for Mozal beyond March 2026,” South32 chief executive Graham Kerr said in a statement late Monday.
“While this is not the outcome we wanted, we are proud of the history and significant contribution Mozal has made to the local community and the Mozambican economy in its 25 years of operation.”
The care‑and‑maintenance process will trigger a one‑off US$60 million cost that includes employee separation and the termination of contracting arrangements, with ongoing annual costs estimated at US$5 million.
Mozal, located on the outskirts of Maputo, is one of Mozambique’s largest industrial operations and a major source of export revenue.
The smelter produced high‑purity primary aluminium for domestic and international markets and is majority‑owned by South32, with stakes also held by South Africa’s Industrial Development Corporation and the Mozambican government.
The shutdown marks a major setback for Mozambique’s industrial sector, which has relied on Mozal as a flagship investment since its commissioning in 2001.
JN/APA