Mozambique has enacted a new mining law requiring the state to hold a minimum 15 percent stake in all mining projects and mandating local processing of minerals before export, as the resource-rich southern African nation seeks to capture greater value from its vast mineral wealth.
President Daniel Chapo signed the legislation into law after it was approved by parliament in May, marking one of the most significant reforms of the country’s mining sector in recent years.
The new law grants the state, through the Empresa Nacional de Mineração (ENM), a minimum 15 percent “free-carried” and non-dilutable stake in all mining ventures across the value chain. A free-carried interest allows the government to hold equity in projects without contributing to development or operating costs.
According to a government notice dated June 3, the reforms are aimed at strengthening Mozambique’s management of strategic natural resources and ensuring that the country derives greater economic benefits from its mining industry.
The legislation also prohibits the export of unprocessed or semi-processed minerals unless companies obtain special authorisation from the government and present approved plans for eventual local processing.
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The move aligns Mozambique with a growing trend among African resource-producing nations seeking to move beyond the export of raw materials and develop domestic value-addition industries.
Countries such as Zimbabwe and the Democratic Republic of the Congo have introduced similar measures in recent years to encourage local beneficiation and increase revenues from critical minerals used in the global energy transition.
Mozambique is a major producer of several strategically important minerals. The country is the world’s third-largest producer of graphite, a key component in lithium-ion batteries used in electric vehicles and energy storage systems.
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One of its most significant mining assets is the Balama Graphite Mine, operated by Syrah Resources in northern Mozambique. The mine is among the largest graphite deposits globally and has become increasingly important as demand for battery materials continues to rise.
Mozambique is also home to the Montepuez Ruby Mine, operated by Gemfields, which is regarded as the world’s largest ruby mine.
In addition, the country possesses substantial coal reserves, including assets previously developed by mining giants Rio Tinto and Vale.
Analysts say the reforms reflect growing efforts by African governments to secure a larger share of revenues from booming demand for critical minerals essential to electric vehicles, renewable energy technologies and industrial manufacturing.
However, questions remain over how the law will affect existing mining operations, many of which are governed by long-term investment agreements negotiated before the legislation was enacted.
The government has not yet clarified whether the 15% state ownership requirement will apply retrospectively to projects already in operation.
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While supporters argue the reforms could stimulate industrial development, job creation and technology transfer, investors are expected to closely scrutinise the implementation of the new rules and their potential impact on investment returns.
The legislation underscores Mozambique’s ambition to transform its mining sector from a source of raw material exports into a catalyst for broader industrialisation, as competition intensifies globally for access to critical minerals.
