Kawaiti group to invest in massive sugar cane plantation in Massingir, Mozambique

sugar_cane_1 sugar_cane

(2015-05-29) The Kuwaiti group, the Al-Badel International Development Company, has guaranteed that, within the next three months, it will launch a gigantic project to grow sugar cane in Massingir district, in the southern Mozambican province of Gaza.

The sugar cane grown in Massingir is intended essentially for the production of bio-ethanol, a supposedly clean source of energy. The project is valued at 1.5 billion US dollars.

This pledge was given by the chairperson of Al-Badel, Ali Mahmoud, at the end of an audience granted on Tuesday by Mozambican Prime Minister Carlos Agostinho do Rosario. During their meeting the two men discussed opportunities for further development projects in agriculture and industry.

Mahmoud claimed that Al-Badel intends to invest 26 billion dollars in Mozambique. Half of this, 13 billion dollars, is earmarked for an industrial unit in the western province of Tete that will convert coal residues into diesel.

“This is a project of great importance since it will reduce Mozambique’s imports of diesel”, said Mahmoud. “The agreements on this project will be concluded within the next six months, and then the phase of the viability study will take off”.

The Al-Badel sugar project is not the first time investors have planned to produce bio-ethanol in Massingir. A contract was signed in 2007 with the company Procana to produce ethanol from a 30,000 hectare sugar plantation in Massingir.

This company, in which the major investor was the London-based Central Mining and Exploration Company (CAMEC), promised to invest 510 million dollars in Massingir. But Mozambique saw almost none of this investment: two years after the contract was signed, all Procana had done was clear 800 hectares of land. The government then cancelled the contract and began looking for other investors for Massingir.

One major challenge facing the project, no matter who the investor is, will be accessing adequate supplies of water. The sugar cane plantation will have little choice but to use water from the Massingir dam on the Elephants river, a tributary of the Limpopo.

After the Procana contract was signed, farmers working further down the river expressed concerns that too much water will be diverted to the sugar cane plantation, leaving their rice and maize fields short. The government responded at the time by promising there would be sufficient water for all parties and that the biofuel project would be developed responsibly.

Source: AIM

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