Mozambique Enacts Revised Petroleum Law

On 3 June 2026, Mozambique published Law No. 8/2026, which constitutes a revision of the Petroleum Law (Lei dos Petróleos). The new statute revokes the former Petroleum Law (Law No. 21/2014) and related regulations will be issued within 90 days.

Below are the main changes introduced by the new statute:

A. Guiding Principles

The revised Petroleum Law places greater emphasis on certain guiding principles, including: State control, participation and sovereignty; public interest; energy security; transparency; environmental and community sustainability; and incentives for greater national participation and industrialization in the value chain.

B. Broader Scope

The scope has been expanded to cover activities related to oil and gas operations, such as carbon capture, storage and utilization (CCSU), emissions control, and unconventional hydrocarbons, as well as regasification activities.

C. Reconnaissance License

The reconnaissance-concession contract provided for under the previous law has been replaced by a reconnaissance license, reserved exclusively for national companies. This new license covers preliminary prospecting activities, including geophysical, geochemical, and geological surveys up to a depth of 100 meters, and must be approved by the Council of Ministers.

D. Contractual Regimes for Petroleum Contracts

The revised Petroleum Law introduces three types of Petroleum Contracts; i.e., exploration and production contracts required to carry out petroleum operations: (i) Concession Contracts; (ii) Production Sharing Contracts; and (iii) Service Contracts. The Government may adopt additional structures in accordance with the national interest. Under the previous Petroleum Law, Mozambique had only one contractual structure, known as a Concession Contract, but which had the substantive characteristics of a Production Sharing Contract. Petroleum Contracts will now be subject to prior review by the National Petroleum Institute (INP) before approval by the Council of Ministers.

E. Infrastructure

The concession contract regime for the construction and operation of petroleum infrastructure, such as pipeline systems (oil or gas), has been maintained. Liquefaction and regasification infrastructure may be developed by concessionaires or by third parties, subject to government authorization.

F. Unitization

The unitization rules have been set out in greater detail, including with respect to cross-border deposits and non-concessioned areas.

G. Operator’s Obligations

The revised Petroleum Law further delineates the rights and obligations of Operators, strengthening duties relating to transparency, corporate social responsibility, and operational supervision.

H. Intervening Authorities

The INP’s functional and technical independence has been expanded, granting it decision-making and approval powers across the entire sector value chain, with authority to carry out inspections and audits at any time, including with respect to recoverable costs. The revised Petroleum Law revokes the creation of the High Authority for the Extractive Industry, an institution that was created by the previous legislation in 2014, but never implemented in practice.

I. State Participation (ENH)

The revised Petroleum Law increases the minimum participation reserved for the State, through the Empresa Nacional de Hidrocarbonetos (ENH), to a 15% non-dilutable participating interest on a free carry basis. Higher percentages may apply in areas with high geological prospectivity. The costs relating to the State’s additional participation must be borne by concessionaires up to a maximum participating interest of 40%, also on a free carry basis, until the start of production (i.e., no longer only during the exploration phase).

J. ENH’s Preemption Rights

Under the revised Petroleum Law, ENH, as the exclusive representative of the State, has a preemption right over any direct or indirect transfer of interests in Petroleum Contracts, including the assignment of shares, quotas or other forms of participation. It is not yet clear whether this preemption right will operate as a right of first offer or a right of first refusal. In addition, ENH has a preferential right in the award of rights over areas whose term has expired or that have been relinquished and it may establish partnerships for their development.

K. Domestic Market

The following domestic supply obligations are established: (i) a minimum reservation of 25% of oil and liquefied natural gas (LNG) production for the domestic market, which was also provided for under the previous law; (ii) delivery of all condensate produced to the State, free of charge, up to the delivery point; and (iii) setting domestic oil and gas market prices below international market levels, in order to support national industrialization.

L. Preferential Participation via the Stock Market (BVM)

In the public offerings for the share capital of State-owned companies, such as ENH and its subsidiaries, through the Mozambique Stock Exchange (BVM), preferential participation must be ensured for Mozambican individuals and legal entities.

M. Goods & Services and Local Content

Foreign persons supplying products and services to petroleum operations must now associate with Mozambican persons. Previously, there was an incentive that granted a procurement preference. In such associations, the economic substance of the association must be demonstrated; that is, the association must provide an effective contribution to the production of goods and services in Mozambique, with local involvement. This obligation is aligned with the Petroleum Operations Regulations and the new Local Content Law (Law No. 09/2026).

N. Community Rights and Social Responsibility

The revised Petroleum Law expands protections for local communities, replacing non-binding arrangements with enforceable compensation agreements entered into directly by concessionaires and affected communities, including socioeconomic support measures and stricter conditions for resettlement. Concessionaires are now subject to additional social responsibility, reporting and monitoring obligations.

O. Environmental Regime

The revised Petroleum Law establishes a more comprehensive environmental regime, requiring the adoption of approved environmental management plans, subjecting petroleum projects to prior environmental impact assessment, and imposing obligations to rehabilitate areas and remedy environmental and social damage.

P. Force Majeure

The revised Petroleum Law provides for a specific force majeure regime, with clearer rules on risk allocation between the Government and concessionaires.

Q. Existing Contracts

As a general rule, the revised Petroleum Law provides that rights acquired under Petroleum Contracts currently in force remain valid. However, the Government may apply the revised Petroleum Law to existing Petroleum Contracts in a broad range of matters, including: economic sovereignty, national defense and security, energy security, transparency, environmental protection, public health, human rights, and the national public interest. In addition, the revised Petroleum Law would apply to existing Petroleum Contracts upon any amendments, extensions or modifications to such existing Petroleum Contracts, which would then become fully subject to the new regime.

R. Regulations

The regulations implementing this revised Petroleum Law will be enacted within 90 days of its publication.