Japan’s public and private sectors are moving into Mozambique in force, securing contracts to build power plants and agreements to provide technical assistance and training.

Trading house Sumitomo Corp. is to sign a contract with a state-run power company Wednesday to construct a gas-fired power plant some 700km northeast of Maputo, the southeast African country’s capital. Work is expected to begin next year, with completion slated for 2021. The 100,000kW facility will satisfy 10% of Mozambique’s power needs. Japanese heavy-machinery maker IHI will supply the power-generation equipment.

Sumitomo last year became the first Japanese company to sign a contract to build a fossil-fuel power station in Mozambique. This plant near Maputo is currently under construction, with an eye toward completion next year. With a 110,000kW generation capacity, it also will supply roughly 10% of the country’s electricity.

Meanwhile, the government-affiliated Japan Oil, Gas and Metals National Corp., or JOGMEC, and trading house Mitsui & Co. are to sign Thursday a memorandum of understanding to cooperate on natural gas production technology and training with a state-run oil company in Mozambique.

Japanese plant engineering company Chiyoda is also expected to strike an agreement with a state-run oil producer in the African country to build a natural gas processing plant.

Mozambique President Filipe Nyusi is visiting Japan for the first time from Monday to Thursday, and will meet with Prime Minister Shinzo Abe. As a major producer of coking coal, his country is drawing Japanese companies’ attention.

Mozambique is enjoying robust economic growth of 6% to 7% a year, but it has a high level of foreign debt and requires financial assistance from various countries, according to the Japan Bank for International Cooperation and others.

Source: Nikkei Asia Review