From the vast coalfields of Tete to the ruby-rich terrains of Cabo Delgado – and the offshore gas riches in the Rovuma Basin – Mozambique’s natural resource wealth forms the backbone of its export economy and holds transformative potential for extensive national development.

Coal has been a longstanding pillar of Mozambique’s extractive exports. The Tete province, in the north-west, hosts some of the continent’s richest coal deposits, including substantial reserves of both coking coal (critical for steel production) and thermal coal (used for power generation). Large-scale operations such as the Benga coal mine, with reserves in the billions of tons, highlight the scale and potential of Mozambique’s coal endowment.

While global demand for coal has faced headwinds amid energy transitions and decarbonisation pressures, demand in key export markets – particularly in Asia – has sustained production interest. Coal remains a vital revenue stream, directly contributing to export earnings and indirectly supporting logistics, transport and local employment ecosystems. Moreover, recent developments suggest renewed investor interest in certain coal assets; for example, Indian steelmaker JSW Steel Limited has moved forward with acquiring a significant coking coal deposit in Mozambique after a concession dispute was resolved in 2025.

Despite its economic importance, the coal sector faces structural challenges. Transport bottlenecks, infrastructure gaps and fluctuating international prices constrain full realisation of export capacity. Moreover, as national policymakers increasingly prioritise the energy transition, balancing coal’s economic contributions against environmental imperatives remains a sensitive policy tightrope.

Yet apart from coal, Mozambique has rapidly carved out a reputation as a global powerhouse for precious stones – particularly rubies. The gemstone story has captured global attention – in May last year govern-ment forecasts projected Mozambique’s ruby output to exceed 4.1 million carats in 2025, a roughly 5% increase over 2024 production, according to a Lusa news report.

The growth follows an earlier surge in which ruby production increased by nearly 46%, from approximately 2.7 million carats in 2023 to almost 3.9 million in 2024, exceeding annual expectations.

A centrepiece of this gemstone boom is Montepuez mine in Cabo Delgado – one of the largest ruby deposits worldwide. Operated predominantly by British company Gemfields (with a 75% stake) alongside Mozambican partner Mwiriti (25%), the mine has generated in excess of US$1 billion in revenue since 2012, paying the Mozambique state US$257.4 million in royalties and taxes in the same period, according to a company report.

In October last year Gemfields announced that it had earned US$49.9 million so far in 2025 from the sale of Montepuez rubies. The company said that it earned US$117.2 million in 2024.

According to Gemfields, US$11 million was raised in a mini-auction of rough rubies held through online bidding following exhibitions in Thailand from late September to early October. It said that 26 of the 33 lots offered for sale were purchased, with ‘only 62% of the 297 449 carats on offer being sold. The average price realised per carat was US$59.43. The proceeds from this auction will be fully repatriated to MRM [Montupuez Ruby Mining] in Mozambique, with all royalties being paid to the Mozambican government on the total sales prices achieved at the auction’.

‘The mini-auction primarily featured mid- and commercial-grade secondary materials,’ said Adrian Banks, chief product and sales officer at Gemfields. ‘We are encouraged by the results and the strong customer engagement, reflecting the growing interest in this new material.’

The company also revealed that it had decided to postpone its usual November/December ruby auction to January/February this year ‘as a result of the delay in the announcement of the definitive start-up of MRM’s second processing plant, now exacerbated by the activity of illegal miners. The new plant’s operations have been significantly impacted over the past week by illegal miners, currently numbering between 250 and 400 per day, sabotaging the plant’s supply infrastructure’.

In mid-2025, MRM embarked on a significant expansion, building a second processing plant designed to triple processing capacity from 200 to 600 tons per hour by the end of the year. This roughly US$70 million investment aims to unlock additional value and export-grade stones more efficiently. In late 2025, Gemfields said MRM was ranked second in Mozambique’s Extractive Sector Transparency Index, highlighting strides in operational accountability.

These dynamics underscore the dual nature of Mozambique’s gemstone potential: vast economic promise paired with social and regulatory challenges that must be carefully managed to ensure sustainable, inclusive growth.

Mozambique’s extractive sector plays an outsized role in its economy. Official estimates indicate that the extractive industry accounts for a significant portion of the country’s GDP and export earnings, with mining, heavy mineral sands, gas and gemstones collectively underpinning export performance.

President Daniel Chapo has publicly emphasised the need to capture greater value from these resources, condemning ‘inferior revenues’ from mining and urging reforms to ensure Mozambicans benefit more from their nation’s natural wealth. Yet governance remains central to realising that ambition.

Strengthening regulatory frameworks, improving transparency, and ensuring that revenues fund social and infrastructure development are critical steps as the country seeks to convert resource wealth into broad-based prosperity.

While mining has historically driven Mozambique’s extractive exports, the story of the past decade has been increasingly dominated by natural gas. The discovery of massive gas reserves in the Rovuma Basin in 2010 has positioned the country as a rising global liquefied natural gas (LNG) producer.

The first major breakthrough came with the Coral Sul Floating LNG (FLNG) project, led by Italian energy company Eni. Production from Coral Sul began in 2022, marking Mozambique’s entry into LNG exports and signalling the start of a new chapter in its energy sector.

The success of Coral Sul has catalysed further investment. Plans are under way for Coral Norte, a second FLNG facility located roughly 10 km north of Coral Sul. Valued at more than US$7 billion, Coral Norte aims to add another 3.55 million tons a year to Mozambique’s LNG capacity and reinforce its role as a major supplier to global markets. Production is expected to begin in the latter half of the decade.

‘With Coral Norte, we will contribute to meeting the growing global demand for LNG, doubling both Mozambique’s contribution to global energy security and the benefits to the country and its citizens in terms of economic and industrial growth,’ said Eni CEO Claudio Descalzi at the signing in Maputo in October last year of the final investment decision of the project. Most recently, in mid-January 2026, the hull launch of the Coral Norte FLNG took place in Geoje, South Korea.

 Meanwhile, in other gas-related developments, French oil major TotalEnergies announced in October last year it was lifting its force majeure on its huge Mozambique LNG project.

Developed in partnership with energy company Mitsui and Mozambique’s national oil company, ENH, the project will have an initial capacity of 13 million tons per year, scalable up to 43 million tons. It was put on hold for four years, following security concerns. According to Reuters, the revised budget features US$4.5 billion in additional costs as well as a 10-year timeline extension.

 Natural gas offers Mozambique a chance to diversify export revenues, reduce reliance on traditional mining commodities and attract large-scale infrastructure investment. If managed wisely, LNG earnings could finance broader economic transformation, including energy access, industrialisation, and regional energy integration, according to analysts.

Nonetheless, risks persist. Security issues in northern Cabo Delgado, historically linked to an Islamic insurgency, have at times disrupted energy projects and deterred investors. The lingering effects of past attacks, most notably the 2021 assault by insurgents on the town of Palma that led to the suspension of some project components, highlight how geopolitical conditions can influence capital flows and operational timelines.

Indeed, caution from some international governments and investors reflects these concerns: recently, the United Kingdom and the Netherlands withdrew support from a major LNG project, citing elevated risk environments and strategic reassessment.

Mozambique’s extractive industry now stands at an intersection of opportunity and complexity. Mining continues to anchor export revenues, attract foreign capital and support employment, but for Mozambique’s leaders and investors, the key challenge lies in strategic stewardship – ensuring that resource exploitation translates into sustainable development, inclusive growth and long-term benefits for citizens.

This demands robust governance frameworks, equitable sharing of benefits, investment in local capacity and infrastructure and proactive risk management. Mozambique’s ability to harness its minerals, gemstones and gas resources while mitigating environmental, social and political risks will determine if its abundant natural wealth becomes a springboard to prosperity or a cautionary tale of unfulfilled potential.

Images: Gallo/Getty Images, iStock