Mozambique: Maputo port concession extended until April 2058

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Mozambique: Maputo port concession extended until April 2058

5:09 CAT | 14 Feb 2024

File photo: Lusa

The concession of the port of Maputo to MPDC will run until 13 April 2058, according to the terms of the addendum to the contract, approved by decree of the Mozambican government and published in the Official Gazette.

“It is extended for an additional period of 25 years from the term contained in its second addendum (13 April 2033), with the concession ending on 13 April 2058, with a view to recovering the additional investments requested by the Government,” reads the decree, to which Lusa had access on Tuesday.

The same decree approves the terms of the Business Plan for making additional investments “aimed at increasing cargo handling capacity at the Porto of Maputo, with the concessionaire being authorised to make additional investments” of $2-06 billion (€1.9 billion) in the Port Concession Area.

The concessionaire for the Port of Maputo plans to invest $600 million (€553.4 million) over the next three years in expanding the port infrastructure, the first phase of investment in the addendum to the concession contract, until 2058.

In an interview with the Lusa news agency this month, the executive director of the Maputo Porto Development Company (MPDC), Osório Lucas, explained that this first phase will increase the capacity of the container terminal from the current 170,000 to 530,000 containers in three years.

“It will also increase the capacity of the Matola Coal Terminal from seven million [mtpa] to 12 million. And our general cargo capacity will rise from 10 million [mtpa] to 13 million in phase 1, which will be completed in the next three years,” he said.

These investments are ready to go ahead immediately after the signing of the addendum to the concession contract, approved on 23 January by the Council of Ministers, and which involves mobilising $600 million in the first three years: “This is another interesting factor. The addendum to the concession contract establishes an obligation to invest in this three-year period and make the first phase of investment. It’s not an option. We’re obliged to do it.”

MPDC expects to go from a cargo handling volume of 26.7 mtpa (million tonnes per year) in 2023 to 50.9 mtpa in 2058 at the end of this new contract extension period of another 25 years (starting in 2033).

By 2058, it also estimates an increase in operational capacity from the current 37 mtpa to 54 mtpa and the terminal’s capacity from 270,000 to one million containers, the expansion of the Matola Coal Terminal from 7.5 to 18 mtpa and the General Cargo Terminal from 9.2 to 13.6 mtpa.

Sociedade de Desenvolvimento do Porto de Maputo is a private Mozambican company that resulted from a partnership between Caminhos de Ferro de Moçambique (CFM), and Portus Indico, which is made up of Grindrod, DP World and Mozambique Gestores.

“This extension, which was negotiated with the government over a period of almost a year and a half, starting in November 2022, aims to create capacity and conditions to increase the volume of cargo handled in our Porto. The nominal capacity before this extension is 37 million tonnes, compared to 17 million tonnes before our investment, and last year we reached 31 million tonnes, which is almost 80% of capacity,” said the executive director.

He added that since 2003, MPDC has invested around $900 million (€830.6 million) in modernising the port infrastructure, increasing capacity to 37 million tonnes by dredging, rehabilitating and deepening more than 1,500 metres of quays, equipment, systems and a training centre.

The port of Maputo currently employs around 10,000 direct and indirect workers, 99% of whom are Mozambican and who depend on the port’s activities every day, a number that the administration expects to grow with the extension of the concession.

“It will have an impact on workers of around 2,000 more, direct and indirect, at the coal terminal or the container terminal,” said the executive director.

Source: Lusa