Australian mining and metals company South32 has raised concerns regarding the future of its Mozal aluminium smelter in Mozambique, citing potential power supply issues and the inability to secure affordable power prices beyond March 2026, as reported by Reuters.

The company has been in negotiations with the primary power provider, Hidroeléctrica de Cahora Bassa (HCB), since 2019 to renew a power tariff set to expire in March 2026.

Under the current agreement, South African utility Eskom is designated to supply power to Mozal when HCB cannot meet the smelter's electricity requirements.

However, South32 has indicated that drought conditions could impact HCB's hydroelectric power generation capacity, leading to increased uncertainty about the future electricity supply to Mozal.

As a result, the production guidance for the financial year 2026 is under review.

Located 20km west of Maputo, construction of Mozal Aluminium commenced more than two decades ago.

With a $2bn investment, Mozal Aluminium stands as the largest private investment in Mozambique.

South32 holds a 63.7% share in Mozal Aluminium, having increased its stake by 16.6% in May 2022.

The Industrial Development Corporation of South Africa owns 32.4%, while the Government of the Republic of Mozambique holds a 3.9% stake through preference shares.

Mozal's production reached 314,000 tonnes (t) of aluminium in the 2024 financial year.

The smelter also supports the country's downstream aluminium industry by supplying liquid metal to Midal Cables, which manufactures products for domestic and export markets.

In early July 2025, South32 entered a binding agreement to divest its Cerro Matoso mine to a subsidiary of CoreX Holding, following a strategic review prompted by shifts in the nickel market.