South32 to Shut Down Mozambique Aluminum Plant Over Unsuccessful Power Negotiations

Published: Aug 31, 2025 23:47

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According to foreign media reports, due to years of unsuccessful negotiations with the Mozambican government on a power supply agreement and prohibitively high electricity costs, multinational mining company South32 recently announced plans to shut down its aluminum plant in Mozambique after the current power agreement expires in March 2026. This project, with annual revenues exceeding $800 million, may enter a care-and-maintenance phase, drawing industry attention to the operational costs of resource-intensive enterprises.

It is understood that the primary reason for South32's planned shutdown stems from a deadlock in power supply agreement negotiations with the Mozambican government. The two parties have engaged in years of discussions over key terms such as post-March 2026 electricity pricing and supply volume but failed to reach a consensus.

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Currently, the aluminum plant primarily relies on Mozambique's domestic hydropower project, Cahora Bassa, supplemented by electricity purchases from South Africa's Eskom during hydropower undersupply. However, the lack of local renewable energy suppliers capable of meeting the plant's massive power demand has long constrained its energy sources. Coupled with persistently high prices, this has led to a continuous decline in the plant's competitiveness in the international market. South32 explicitly stated that continuing operations would be "economically unvia

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