The Coral Sul FLNG project, the only LNG initiative in production in Mozambique until 2025, generated $253 million in tax revenue between 2022 and 2025. Although significant, this figure is set against a fragile macroeconomic context. Mozambique’s GDP stands at around $22.4 billion. Sovereign debt exceeds $12.5 billion, and debt service accounts for an increasing share of tax revenue. The long-term projections in this study paint a more realistic view than the prevailing narrative regarding economic transformation through LNG.
Under the baseline scenario ($12/MMBtu), the Coral Sul project is expected to generate $4.028 billion in tax revenue over the course of the project’s 27-year lifespan, which corresponds to an average of $149 million per year. In the stress scenario ($8/MMBtu, consistent with an accelerated energy transition trajectory), the total falls to $1.456 billion, with IRPC equal to zero throughout the project’s entire lifetime. In the optimistic scenario ($16/MMBtu), the total comes to $11.355 billion. The range between scenarios is 7.8 times, which illustrates the extreme vulnerability of Mozambique’s tax revenues to fluctuations in international LNG price, a factor over which Mozambique has no control.
