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Oil major ExxonMobil could this week set a target for a final investment decision (FID) on a planned liquefied natural gas (LNG) project in Mozambique costing up to $33 billion.

This is part of an unprecedented investment boom.

Mozambique is sitting on some of the world’s biggest untapped gas reserves, with companies lining up to develop its LNG sector. In July a final investment decision was reached on a $20 billion project being built by French oil major Total.

With the potential to become a major gas exporter, this should be transformational for the country’s $15bn economy in the coming years.

The big question is whether Mozambique can avoid the ‘resource curse’ – the paradox of economic underdevelopment despite vast revenues associated with many resource-rich African economies.

A high profile debt crisis linked to shady borrowing hangs over the economy – hinting at exactly the kind of poor governance associated with the ‘resource curse’. All eyes are also on presidential elections on October 15, following a peace deal between the ruling Frelimo party and opposition group Renamo aimed at ending a legacy of conflict and instability.

The jury is out on how prepared the country is.

Not in doubt is the scale of the opportunity that has come knocking. Let’s hope Mozambique doesn’t become just another cautionary tale of the ‘resource curse’.

This report reflects the views of the author alone, not those of How we made it in Africa.

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Today’s picks

From the continent

Zimbabwe’s economy is expected to contract by up to 6% this year, according to its ministry of finance. The country is in the midst of its worst economic crisis in a decade, which has seen inflation soar amid shortages of basic goods. More: Reuters

A UN peacekeeper has been killed, and three others wounded, in northern Mali in two separate attacks by unidentified attackers. This comes a week after a high profile attack on two army camps in the country, which left at least 28 soldiers dead, amid growing concerns about Islamist militancy in Mali and the wider Sahel region. More: UN News

The global perspective

Australia’s Fortescue Metals Group has submitted a bid to develop two blocks in Guinea’s iron ore deposit. Development of the deposit, one of the world’s biggest, has been bogged down for years by legal disputes and corruption allegations. More: Reuters

Germany has announced $73 million in financial aid to Somalia over two years to support economic reform efforts. The country has taken nascent steps towards stability in recent years, following decades of chronic conflict. More: Anadolu Agency

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