Mozambique to invest in gas powered vehicles

MAPUTO (Reuters) - Mozambique will invest in gas powered vehicles to reduce its dependence on imported fuel and cut down its soaring oil bill, a minister said on Tuesday.

Environment Minister Alcinda Abreu, told reporters that Mozambique's plentiful supplies of natural gas could play a big role in achieving the country's energy and environmental goals.

It has already imported several gas-operated buses for public transport from China.

"Mozambique is a country with huge potential in the energy sector and natural gas is a resource that occupies a special position, with reserves estimated at 3.6 trillion cubic feet in the Pande and Temane fields (in the southern province of Inhambane)," she said.

Mozambique will this year spend $700 million on fuel imports due to the increase of crude oil on the international market.

It currently spends $350 million per year in the imports liquid fuels.

In 2007, Mozambique's total consumption of imported fossil fuels was 600,000 cubic meters, of which more than 421,000 cubic meters was diesel.

Mozambique sees the $1.2 billion natural gas project headed by South Africa's petrochemical giant Sasol in Inhambane as central for reviving hopes for its economic growth.

Sasol in partnership with the Mozambique Hydrocarbon Company (ENH) has completed building an 856 km pipeline to transport gas from Temane and Pande, to its fuel complex in Secunda across the border in South Africa.

Mozambique has also floated an international tender to issue more gas exploration licenses.

(Reporting by Charles Mangwiro; +27 11 775 3158)

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