Australian mining group South32, owner of Mozambique’s largest industrial operation, Mozal, will cease production in March 2026 when its current electricity supply contract ends, citing a lack of guarantees for continued power.

The company said, in a statement to the market, talks with the Mozambican government, Hidroeléctrica de Cahora Bassa (HCB) and South Africa’s Eskom have failed to secure “sufficient and affordable” electricity beyond that date. As a result, it will halt pot relining, cut contractors from this month and place the smelter in “care and maintenance” after March 2026.

Mozal consumes nearly half of Mozambique’s electricity and contributes around 3% to GDP. Output for the 2026 fiscal year is forecast at 240,000 tonnes, reflecting reduced operations. South32 has already booked a US$372 million (€318.3 million) impairment loss.

The government insists supply is not at risk and plans for state utility Electricidade de Moçambique (EDM) to take over provision from Eskom. Mozambique aims to end the long-standing Eskom export contract in 2030, redirecting HCB’s power for domestic use and expanding hydropower capacity.