Mozambique: CMH plans ahead as ‘sharp decline’ projected for Pande and Temane gas reservoirs in coming years

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Mozambique: CMH plans ahead as ‘sharp decline’ projected for Pande and Temane gas reservoirs in coming years

12:01 CAT | 22 Sep 2025

File photo: Sasol

Profits at Companhia Moçambicana de Hidrocarbonetos (CMH) fell 15% in the last financial year, to $46.7 million (€39.4 million), with the state-owned company warning of a “sharp decline” in gas reservoirs in coming years.

“One of our greatest challenges will be responding to the sharp decline in production in our Pande and Temane reservoirs in the coming years, in order to maintain current performance levels,” stated the company’s board of directors, chaired by Arsénio Mabote, in its 2024/2025 annual report, which closed in June and was accessed today by Lusa.

“We also need to continue identifying new opportunities that add value to our business, counting on the collaboration of our shareholders, with whom we have been developing the most appropriate strategies to ensure adequate guarantees of our long-term business continuity,” the message adds.

CMH’s profits had already fallen 15.5% in the fiscal year ending June 2024, to US$54.7 million (€46.1 million), according to previous data from the state-owned oil and gas company. This decline has been further compounded in the 2024/2025 period, which also saw a 9% drop in the company’s natural gas sales compared to the previous year.

CM’s management attributes the decline in financial performance to “fluctuating oil prices on the international market, as well as operational problems in key units at the Temane processing plant,” located in Inhambane province, south of the country.

These issues, the report states, limited “the production capacity of gas and its derivatives, despite routine maintenance being carried out.”

The document adds that, in order to “ensure compliance with its contractual obligations,” CMH continued implementing projects “aimed at maintaining and optimising production capacity through maximising gas recovery” in certain reservoirs and new wells.

“The past year was quite challenging, as production operations continued to be affected by several endogenous and exogenous factors, within an environment influenced by the current international geopolitical situation, which impacted demand and pricing for natural gas, condensates, and their derivatives,” the report acknowledges.

Despite these difficulties, CMH’s management affirms that the company has maintained “sustainable growth” and is now focused on improving “management efficiency.”

“We hope to continue providing dividends to shareholders in the coming years,” the report concludes.

CMH carries out oil and gas production operations and is controlled by state-owned Empresa Nacional de Hidrocarbonetos (ENH), which holds 70% of its share capital. CMH was appointed by the Mozambican government to operate, in partnership with South Africa’s Sasol Petroleum Temane (SPT), the Pande and Temane gas production fields for a period of 30 years under the Petroleum Production Agreement signed in October 2000.

The company is also a party to the Joint Operating Agreements signed with SPT in December 2002, covering the Pande and Temane reservoirs. CMH operates on an integrated basis, producing and selling only natural gas.

Mozambique has three approved development projects to exploit the natural gas reserves of the Rovuma Basin, located off the coast of Cabo Delgado and ranked among the largest in the world.

In addition to the Eni-operated project, which is currently the only one in production, two other major projects are in the development phase: Mozambique LNG (Area 1), operated by TotalEnergies, with a projected capacity of up to 43 million tonnes per annum (mtpa); and Rovuma LNG (Area 4), operated by ExxonMobil, with a planned capacity of 18 mtpa.

In 2024, a study by consultancy firm Deloitte concluded that Mozambique’s gas reserves could generate potential revenues of US$100 billion (€96.2 billion).

Even without the remaining projects yet coming online, Mozambique’s estimated gas production in 2025 is 5.4 billion cubic metres, making it the sixth-largest producer in Africa.

Source: Lusa