Mozambique: South African energy crisis affects Mozambican aluminium factory

9 April 2008

Maputo, Mozambique, 8 April – South Africa’s current energy crisis is affecting aluminium production at Mozambique Aluminium Smelter (MOZAL), a US$2.3 billion project located in Boane, southern Mozambique.

MOZAL’s director for Reduction Services, Josué Igaúque, told Mozambican journalists that despite certain sectors of the factory using butane gas, there were sectors that needed only electricity.

As a result of the energy crisis, MOZAL has reduced its electricity consumption, which is estimated at around 700 Megawatts per day or half the consumption of the city of Maputo, by around 10 percent.

MOZAL is owned by BHP Billiton (UK-Australia), Mitsubishi Co (Japan), Industrial Development Corporation (South Africa), African Development Bank (ADB), the IFC (World Bank) and CDC (Commonwealth Development Corporation). The Mozambican state is also a shareholder.

The energy crisis in South Africa has affected the plan to implement the third phase of the project, which would allow MOZAL to produce 500,000 tonnes of aluminium as compared with current production of 250,000 tonnes.

The majority shareholder BHP Billiton, with 47 percent, has decided not to go ahead with the third phase until alternative energy sources can be found.

In order to implement the third phase, the company needs a further 900 megawatts of electricity.

The board of directors of the Cahora Bassa Hydroelectric Dam (HCB) recently announced it would provide 300 megawatts of electricity to the Southern African Development Community (SADC), but that power is not enough to cover energy needs, particularly those of MOZAL.

Of the 300 megawatts, 250 are to be channelled to Eskom, South Africa’s electricity company, with which Mozambican power company, EDM, and another from Swaziland set up MOTRACO, which supplies MOZAL with power. (macauhub)