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After a few years of civil struggle and political instability, Mozambique is returning to a state of normality and consequently its upstream oil and gas business is of growing importance in the area. Mozambique’s upstream potential seems to lie in pure gasoline slightly than oil. The critical factor in the future exploitation of the nation’s gasoline, nevertheless, is the emergence of sound commercial criteria for the institution of a south-east African gasoline-gathering network capable of serving growing markets in the region.

Substantial reserves of pure gas have been established and Mozambique is prone to develop into a major producer of gas in the world in the medium time period. There are three onshore gasoline fields, Pande, Temane and Buzi-Divinhe. Pande has reserves estimated to be in excess of two.1 Tcf,, Temane reserves within the order of 1.Zero Tcf and Buzi has recoverable reserves within the order of 10Bcf. Precise gasoline production is limited to an insignificant amount from the Pande gasoline area that supplies the needs of local villages.

Mozambique launched its First Offshore Licensing Spherical on 31 March 2000. This bidding round is offering 14 blocks mainly in the Mozambique Basin protecting the shallow and deep Zambezi delta space.

The principle players in the upstream business include: Enron Oil and Gas Assets Inc, Power Africa, Sasol Petroleum International, Leopardus Sources Restricted, Zarara Petroleum Assets, TotalFinaElf SA, Trefoil Ltd, and Lonrho de Provuma Petroleum. BP, Elf and Western are involved in geophysical surveys of offshore areas.

The downstream oil trade relies on imports, mostly from South Africa. Distribution and marketing of gas merchandise and lubricants is carried out by the state owned oil company Petromoc. Different firms include BP, Mobil, Caltex.

There are three ports in Mozambique, Maputo, Beira, and Nacala which provide an economic provide corridor to neighbouring landlocked international locations.

A major challenge is being negotiated between ENH, the state oil company, Sasol Petroleum International and Enron Oil and Gasoline to assemble a pipeline that can transport gas from each the Pande and Temane gasoline fields to the Gauteng area in South Africa. The pipeline between Beira and Harare has been prolonged and is operating close to full capacity even with an expansion through the addition of pumping stations.