Mozambique requested $37.2 billion for protection against climate disasters

The President of Mozambique called for the allocation of 33.5 billion euros to strengthen the country's climate resilience over the next decade. This request comes against the backdrop of registering more than 76 natural disasters in the last 25 years.

During the 31st United Nations Climate Change Conference (COP31), held in Turkey, Daniel Chapo stated that Mozambique requires approximately $37.2 billion (equivalent to 33.5 billion euros) over the next decade to enhance resilience and protect its population. He appealed to bilateral and multilateral partners, as well as other stakeholders, for support.

The head of state noted that between 2000 and 2025, Mozambique suffered from over 76 climatic events, including floods, inundations, and cyclones, resulting in human and economic losses exceeding $4.5 billion (€4.1 billion).

In light of this situation, the president emphasized that climate change adaptation and disaster risk reduction are strategic priorities. A National Adaptation Programme has been adopted, focusing on strengthening early warning systems and integrating the climate aspect into local planning. The country has at least 141 local adaptation plans and over 1,500 local disaster risk management committees.

In addition to Mozambique, Daniel Chapo urged the international community to increase support for African countries in risk prevention and building resilience under the concept of 'climate justice and climate finance.'

In the context of the tenth anniversary of the Paris Agreement, the Mozambican president also highlighted the need for major economies to take the initiative in reducing emissions and fulfilling their commitments on climate finance.

Mozambique is considered one of the most vulnerable African countries to the effects of climate change, regularly facing tropical cyclones, floods, and severe storms. According to data from the National Institute of Disaster Management and Risk Reduction (INGD), the last rainy season, which ran from October 2025 to April 2026, resulted in 311 deaths and affected about 1.07 million people.

The Mozambican government intends to resume the implementation of the Temane Thermal Power Plant project in Inhambane province. This project involves attracting financing from the World Bank of up to $65 million (58.3 million euros), as well as reducing rates and extending the concession by 30 years.

A support package for the restoration of the Temane Thermal Power Plant (CTT) project was recently approved by the Council of Ministers. The government justified this decision by citing delays in infrastructure implementation, which are considered to have national economic and strategic interest, according to Resolution No. 88/2026 dated November 4.

CTT is the concessionaire of the Temane Thermal Power Plant, which will generate electricity from natural gas in Inhambane. State electricity grid EDM (Mozambique Electricity) is among the project shareholders.

According to the document, the project implementation faced 'significant delays due to force majeure circumstances, specifically Cyclone Freddy and Tropical Storm Filippo, as well as the contractor's refusal to work.'

To ensure the completion of the station construction, the Government authorized 'the mobilization of funding through the World Bank to guarantee EDM's capital contribution up to $65 million, corresponding to EDM's obligations as a project shareholder.'

The resolution also allows for the extension of the project's concession period. The executive branch establishes in the same resolution 'an extension of the concession agreement term by six additional months to the initially granted 18 months, due to force majeure circumstances, leading to a change in the Concession Agreement term from 28 to 30 years.'

The package includes financial benefits for the project through the reduction of concession rates. According to the document, they are lowered 'from 3% to 2% during the debt repayment period' and 'from 8% to 5% after the debt repayment period and until the end of the concession.'

Among the adopted measures is also a 'temporary waiver of dividends of up to $39 million (35.0 million euros), above which dividends will resume in favor of EDM,' as well as a 'waiver of the right to claim compensation for delay' up to approximately $10.8 million (9.7 million euros).

The Council of Ministers also authorized an 'adjustment of 11.1% to the Capital Recovery Tariff component,' which is one of the measures necessary to strengthen the enterprise's economic and financial balance.

However, the actual entry into force of the package depends on additional agreements between the involved parties. The resolution stipulates that the measures are conditional on negotiations regarding guarantees aimed at protecting the interests of the state electricity grid EDM and consumers.

These conditions include the requirement to 'ensure that any additional project revenues, including revenue from the performance guarantee of contractor TSK, which is under litigation, go towards future tariff reductions in favor of EDM.'

The document also provides for the 'release or cancellation of potential late payment interest calculated within the commercial agreement,' within limits corresponding to the additional contribution of the adjusted tariff rate during the commercial operation period.

Another protection measure is the 'revision of the station construction management agreement concluded with CTT, to ensure more active participation of EDM in management, monitoring, and decision-making processes,' which is intended to reduce the risk of new delays in completing the work.

The Government of Mozambique has extended the agreement for Kenmare's operations at the Moma titanium mine. According to the company itself, the reciprocal conditions include royalties of up to 5%, investments amounting to 185 million euros, and local processing.

The Irish mining company Kenmare Resources informed the market that the Council of Ministers approved the extension of rights and concessions covered by the Moma heavy sand mine Implementation Agreement (AI), located in Nampula province, northern Mozambique. This decision includes changes to the tax, commercial, and investment regimes applicable to the subsidiary Kenmare Moma Processing (Mauritius) Limited (KMPL).

Kenmare Resources specified that approval was obtained on October 13, and the official notification was received on October 29. The company has been operating the Moma mine since 2007, and its production accounts for about 6% of the global supply of titanium raw materials, which are supplied to clients in more than 15 countries for use in the production of paints, plastics, and ceramic coatings.

The new agreement regulates KMPL's mineral processing and export activities, while the mining operation itself remains under a separate legal framework. The initial 20-year authorization was set to expire in December 2024, and the company has been negotiating an extension for another two decades since then, continuing to operate under the previous terms during the transition period.

The company's CEO, Tom Hickey, stated that Kenmare is satisfied with the approval of the extension of its rights and concessions under the Moma AI. He noted that the company possesses mineral resources to support production 'for more than 100 years' and justified the agreed changes by the need to achieve 'a proper balance between Kenmare's interests and a greater contribution to Mozambique.'

Among the changes is a gradual increase in royalties from the company's gross revenue. Currently, it stands at 1%, but will rise to 3% from 2025 to 2029, to 4% from 2030 to 2034, and to 5% from 2035 to 2044. The introduction of a 20% withholding tax on services provided by KMPL from abroad is also planned, which will come into effect after signing a supplementary agreement formalizing the extension and related terms.

The company commits to investing no less than $200 million (185 million euros) in industrial facilities, equipment, and infrastructure over the next 20 years. Furthermore, it retains the right to request a new 20-year extension in 2044, according to current legislation. KMPL is also obligated to finance and implement social projects and corporate responsibility totaling $50 million (46.3 million euros), aimed at education, healthcare, transport, communication routes, energy, water supply, sanitation, and small and medium enterprise development.

Another provision allows the Mozambican state to acquire up to 20% of KMPL's annual output directly or through third parties for local processing 'at market prices,' subject to prior notification two years or another period agreed upon by the parties. According to Hickey, 'the extension gives Kenmare the necessary confidence to continue investing in Moma' and 'support host communities while continuing to generate income for all stakeholders.' During this process, the company acknowledged the possibility of resorting to international arbitration if agreement on the new terms could not be reached, although it always preferred resolution through negotiations.

Kenmare reported that it is currently working with the Government of Mozambique on signing a supplementary agreement, which will subsequently be submitted to the Administrative Court within the necessary legal procedures to finalize the process.