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Mozambique: Government Approves Eucalyptus Plantations

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November 16, 2009
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Plantation Management


Maputo — The Mozambican government approved on Tuesday a project to plant eucalyptus trees for industrial purposes across large swathes of the northern province of Nampula.

The project, proposed by the Norwegian-owned company, Lurio Green Resources, involves total investment of 2.2 billion US dollars.

According to the government spokesperson, Deputy Education Minister Luis Covane, only 209 million dollars will be spent on the eucalyptus plantation itself. The remaining two billion is for sawmills and other industrial infrastructure.

"The company will establish a forestry plantation for the production of paper, sawn wood and charcoal, and also for the generation of electricity", said Covane. "Part of the land granted to the company will be used for food production".

Lurio Green Resources initially asked for a concession of 210,000 hectares, but in the end the government granted it 126,000 hectares in several blocks in Mecuburi, Ribaue and Nampula districts

The project is expected to create 11,500 jobs, and the company has promised to invest 30 million dollars in building schools, health centres and other infrastructure for communities living in the project area.

A second, even larger eucalyptus project approved by the government on Tuesday will cover over 173,000 hectares in Ile and Namarroi districts, in the central province. In this case, the investor is the Portuguese forestry and paper group Portucel.

Covane gave no details of this project, but from the Portuguese media it is known that Portucel has been negotiating to set up a paper pulp factory in Mozambique.

But threre is other Sources: "The Mozambican government granted Portuguese pulp and paper company Portucel, 173,000 hectares of land to plant eucalyptus trees, with a view to building a pulp and paper mill in Zambezia provinces, in central Mozambique, as Macauhub reported.

The project, which will be located in the districts of Ile and Namarroi, in Zambezia province, is expected to have production capacity of around a million tonnes of paper per year. The move by the Portuguese group is part of Portucel’s internationalisation process. Portucel is one of the biggest non-coated fine paper producers in Europe."

March 27, 2008: According to Thompson Financial, Portucel – Empresa Produtora de Pasta e Papel SA is considering building a plant in Mozambique, according to the chairman of Portugal’s investment agency, Basilio Horta.

Diario Economico reported that the plant would cost about €1 billion. Mozambique is a strong candidate for the plant because of the “high productivity of its eucalyptus forests” (sic).

Diario Economico added that Potucel is also considering other locations including Angola, Uruguay, Brazil and Portugal.

But earlier this month, Thompson Financial reported Portucel as saying that “Portugal has not been considered a possible location for a planned new pulp plant due to a current lack of available raw materials”.

Lurio Green resources,  a Norwegian company has plans to invest over 2 billion $US in Eucalyptus plantations in Mozambique, Africa.  The government in Mozambique  has just approved the eucalyptus project.  The  forestry species will be specifically grown and harvested for industrial purposes across the northern province of Nampula.

Luis Covane,  government minister stated that over 200 million dollars will be spent on the eucalyptus plantation itself and approximately two billion will be invested in timber related  industrial infrastructure.

“The company will establish a forestry plantation for the production of paper, sawn wood and charcoal, and also for the generation of electricity. Part of the land granted to the company will be used for food production”.

According to report from the “Macauhub”,   Lurio Green Resources requested up to 210,000 hectares of land for it’s eucalyptus platations, but was actually allocated 126,000 hectares in the Mecuburi, Ribaue and Nampula districts.  From a local  employment perspective,  the benefits will be wide ranging, with the creation of up to 12000 new jobs being expected directly and indirectly as a result of the new investments in forestry projects.

Additionally, the  Norwegian company intends to  invest up to 30 million dollars in community infrastructure for the indigenous people, with schools and health centres being constructed  in the area.

Other  forestry investments in the region were  also announced  in the report,  with the news that just shy of 175,000 hectares of eucalyptus plantations in the  Ile and Namarroi districts are in the proceess of  developing by a  Portuguese company Portucel.  In this case, the  forestry investor is the Portuguese forestry and paper group Portucel (one of Europes largest producers of paper and pulp), which plans to construct a paper/pulp manufacturing faciliity in Mozambique.


Figueira da Foz — Mozambican motorists will pay the real market price of the fuel they consume, when the current fuel subsidy terminates, Prime Minister Luisa Diogo has warned.

Speaking to AIM in the Portuguese town of Figueira da Foz, Diogo said that, while the government could continue to subsidise the diesel used in passenger transport, it was an entirely different matter to subsidise the fuel used by private owners of luxury vehicles.

Fuel prices have remained unaltered since March. In the early part of the year, international fuel prices were falling, and on 18 March the Ministry of Industry announced a 20 per cent cut in the price of liquid fuels. A litre of diesel now cost 22.45 meticais, of petrol 23.1 meticais and of kerosene 15.58 meticais (at current exchange rates there are about 27.5 meticais to the US dollar).

Since then international prices have risen sharply, but the government opted to freeze the Mozambican price at the March level (even though the last time petrol was as cheap as this was early 2005).

To keep the prices low, the government had to negotiate with the fuel distribution companies. It agreed to compensate them for their losses with payments equivalent to 34 million dollars up to the end of this year.

Any hopes that the price of fuel might fall again by a substantial amount have been dashed. After dropping to around 40 US dollars a barrel in March, the price (on the New York Mercantile Exchange) now stands at over 77 dollars. The current conventional wisdom is that, with developed economies pulling out of recession, there will be a greater demand for oil, and so prices are more likely to rise than to fall.

"If prices do not fall", said Diogo, "then naturally we Mozambicans will find ways of balancing the effort of the government and contributing so that the cost of living of the population does not worsen".

That would mean a targeted subsidy aimed at passenger transport - both the publicly owned buses, and the private mini-buses (colloquially known as "chapas" that provide so much of Mozambican urban transport).

But unlike the current subsidy, this would not cover "those who own four wheel drive vehicles who have the capacity to buy the fuel at its market price", she added.

"The government will continue to give support to those who need support by subsidising passenger transport", Diogo pledged. "But those who have the ability to do so will have to pay the real price of the fuel".

Diogo was attending the Global China Business Meeting held in Lisbon, but travelled to Figueira da Foz to visit the industrial complex of the Portuguese group Portucel Soporcel. This company is a major paper producer and plans to invest in eucalyptus plantations in Mozambique.


Portucel plans pulp plants in Uruguay and Mozambique

Moscow. Aug 29, 2008. /Lesprom.com/. Portugal's pulp and paper maker Portucel signed memorandums of understanding with the governments of Uruguay and Mozambique aimed at pursuing pulp and paper projects in the two countries, Reuters reported.

In South America's Uruguay, it sought a 1.3 million tonnes annual capacity pulp unit, which should be followed by a paper production plant.

In the southern African nation of Mozambique, the plan is to install a similar project with a capacity of at least 1 million tonnes a year, Portucel said in a statement.



Extpub | by Dr. Radut