Zimbabwe’s Gas Bonanza: A Game-Changer for the Economy?

The southern African nation has announced a major gas discovery that could transform its energy sector and boost its development prospects.

by Victor Adetimilehin

Zimbabwe is celebrating a potentially significant gas find in the Cabora Bassa Basin, near its border with Mozambique. The discovery, announced by the government and the Australian-listed company Invictus Energy, is the first of its kind in sub-Saharan Africa and could lead to the country’s first gas production.


According to Invictus, the gas field contains light oil, gas condensate and helium, and has been proven by samples sent to the US for independent verification. The company, which has been working on the site for a decade, said the discovery “opens up a new hydrocarbon province” in the region.


The gas field is estimated to hold 20 trillion cubic feet of gas, which is equivalent to about four times the proven reserves of Mozambique, which is home to large gas deposits that have attracted billions of dollars of foreign investment.


A Boost for Zimbabwe’s Power Sector


The gas discovery could be a game-changer for Zimbabwe’s energy sector, which has been plagued by chronic shortages and frequent blackouts. The country relies heavily on hydroelectric power from the Kariba Dam, which has been affected by droughts and low water levels. It also imports electricity from neighboring countries, such as South Africa and Zambia, which are also facing power challenges.


Based on a report by New Zimbabwe, Invictus Energy plans to build a gas-to-power facility to supply the national grid, which could reduce the country’s dependence on imports and increase its energy security. The company said the gas field has the potential to generate up to 3,000 megawatts of electricity, which is more than the current peak demand of 2,200 megawatts.


The gas project could also create thousands of jobs and stimulate economic activity in the area, which is one of the poorest and most underdeveloped in the country. Invictus said it will work with the local communities and the government to ensure that the project benefits the people and the environment.


A Windfall for the Government


The gas discovery is also a boon for the government of President Emmerson Mnangagwa, which is entitled to as much as 60% of the project’s output under an agreement with Invictus. The government hopes that the gas revenues will help it address its fiscal challenges and fund its development agenda.


Zimbabwe has been struggling with a severe economic crisis, exacerbated by the effects of the COVID-19 pandemic, which has hit the country hard. The country faces high inflation, low growth, soaring unemployment, and a shortage of foreign currency. The government has also been under pressure from the international community to implement political and economic reforms, as well as to respect human rights and the rule of law.


The gas project could provide the government with a much-needed source of income and improve its credibility with investors and donors. However, the government will also have to ensure that the gas revenues are managed transparently and accountably, and that they are used for the benefit of the people and not for the enrichment of a few elites.


A Long Way to Go


While the gas discovery is a promising development for Zimbabwe, it is not a guarantee of success. The gas project will require significant investment and technical expertise, as well as a conducive regulatory and legal framework. It will also face logistical and security challenges, as the gas field is located in a remote and volatile area, close to the conflict-ridden province of Cabo Delgado in Mozambique.


The gas project will also take time to materialize, as it is still in the exploration stage and not yet in production. Invictus said it will drill a second well in the first quarter of 2024, and expects to start producing gas by 2026. It will also have to conduct further studies and assessments to determine the feasibility and viability of the project.


It will have to contend with the environmental and social impacts of the gas extraction and utilization, as well as the potential risks of gas flaring, leakage, and emissions. Invictus said it will adhere to the highest environmental and social standards, and will seek to minimize the carbon footprint of the project.


The gas discovery is a rare opportunity for Zimbabwe to turn its fortunes around and to achieve its vision of becoming an upper-middle-income country by 2030. However, it will require careful planning, prudent management, and inclusive participation to ensure that the gas bonanza is a blessing and not a curse for the country and its people.

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