Mozambique’s government is taking all necessary steps to ensure that the Mozal aluminium smelter, operated by Australian mining company South32, remains open despite ongoing challenges over power supply agreements, Mineral Resources and Energy Minister Estevao Pale said on Monday.
Speaking to reporters on the sidelines of a conference in Cape Town, South Africa, Minister Pale emphasized that the government is fully engaged in negotiations aimed at preventing the closure of the energy-intensive facility, which forms a critical part of the southern African nation’s industrial base.
South32 had announced in December 2025 that it would place the Mozal plant under care and maintenance by March, citing failure to secure a long-term power agreement with the government. The move would involve a one-off cost of approximately $60 million and would temporarily halt production, raising concerns over potential impacts on employment and industrial output in Mozambique.
The Mozal smelter, located near Maputo, has been operational since 2000 and is one of the country’s largest industrial assets, producing high-grade aluminium for both domestic use and export. The facility is highly energy-intensive, consuming significant volumes of electricity, which has made the negotiation of cost-effective and reliable power supply agreements a longstanding challenge.
Mozambique’s government has been working alongside regional power suppliers and private operators to develop solutions that would allow Mozal to continue operations. According to Minister Pale, authorities are exploring a range of measures, including securing long-term electricity contracts, optimizing tariffs, and ensuring that supply remains uninterrupted for the smelter’s operations.
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“The government is committed to taking every step required to ensure that Mozal continues to operate, as the plant represents a key pillar of our industrial strategy and a significant source of jobs and foreign exchange earnings,” Pale said.
The announcement comes after years of protracted negotiations between South32, the Mozambican government, and regional energy providers. The company has repeatedly highlighted the challenge of securing affordable and sustainable electricity to support its smelting operations, which rely on continuous high-voltage power. Any prolonged disruption could have serious financial consequences for both the company and the country.
South32’s decision to place Mozal under care and maintenance has raised concerns about potential ripple effects on Mozambique’s broader industrial ecosystem, including suppliers, transport logistics, and export revenues. Analysts note that aluminium production contributes to national GDP, foreign exchange earnings, and industrial employment, making the continuation of the smelter a priority for policymakers.
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Efforts to resolve the issue are complicated by broader regional energy dynamics. Mozambique exports electricity to neighboring countries through the Southern African Power Pool, and domestic supply constraints, rising demand, and cost pressures have all complicated negotiations with large industrial consumers such as Mozal.
Despite these challenges, the Mozambican government has signaled a strong commitment to retaining the plant as part of its broader industrial and economic strategy. Officials have highlighted the importance of maintaining strategic industrial assets to support the country’s diversification objectives and attract further foreign investment.
The outcome of the negotiations will be closely watched by investors and regional stakeholders, as it could set a precedent for other energy-intensive industries in Mozambique and southern Africa. While South32’s announcement initially suggested a potential temporary shutdown, Minister Pale’s remarks underline the government’s intention to find a mutually acceptable solution that keeps the smelter operational.
As discussions continue, the Mozal aluminium plant remains a central asset in Mozambique’s industrial landscape, and the government is actively working to ensure that the facility can continue contributing to economic growth, employment, and export revenue in the coming years.
