Dedicated logistics for Mozambique’s LNG projects

October 1, 2024

Joaquim Zucule, chairman of CFM Logistics, talks to The Energy Year about reinforcing existing infrastructure along Mozambique’s logistics corridors and the ongoing development of the Palma Logistics Terminal. CFM Logistics is a subsidiary of CFM, Mozambique’s railway and port authority, specialising in supply chain logistics.

What prompted the creation of CFM Logistics?
CFM Logistics is a wholly owned subsidiary of CFM launched in August of 2023 to provide logistics support for Mozambique’s LNG projects. CFM has a strong track record managing ports, railways and other logistics infrastructure, but we recognised the need for a dedicated logistics company to support LNG projects, and we were incorporated with that mandate.
We are present in key locations such as Maputo, Nacala and Pemba, and can provide comprehensive support to the government of Mozambique and LNG projects across the country, from north to south. With CFM’s 120 years of experience in port operations, our capabilities include onshore and offshore marine services, stevedoring and a full range of logistical services to ensure the smooth execution of LNG projects.

Which companies do you see as potential clients of CFM Logistics?
We are eager to partner with any LNG company operating in Mozambique and are prepared to support companies in the oil and gas sector by building new facilities, managing raw material transportation and providing maritime services. For the Rovuma Basin liquefaction project, CFM Logistics has teams ready in Pemba and facilities in place, and we are constantly exploring ways to expand our service offerings.

Does CFM Logistics envision providing services also beyond the borders of Mozambique?
CFM’s network covers the three main corridors of Maputo, Beira and Nacala, which have a robust railway infrastructure linking Mozambique to Eswatini, South Africa, Zambia, Zimbabwe, Malawi and the Democratic Republic of Congo. With these links in place, CFM Logistics will be positioned to meet the growing demands of the region.
CFM recently received approval for a USD 70-million loan from the AfDB [African Development Bank] which will be used to acquire rolling stock to transport minerals from these countries to seaports for subsequent export to international markets.
Around 95% of the cargo that passes through the Maputo corridor arrives from South Africa and we are present on the border, in Ressano Garcia. Our focus here is to transfer this predominantly road-based traffic to rail, which will be a great opportunity for CFM Logistics and will bring many advantages, including lower accident rates and the ability to transport larger loads, which will indirectly reduce maintenance costs for operators.
In addition, estimates suggest that the change could eliminate 20 million tonnes of carbon dioxide emissions per year, significantly reducing the environmental impact of trade along this artery.

What are the company’s primary objectives for the next few years?
2024 has been a key year, and we have several major projects under way. I would highlight the port of Palma, where we are reinforcing the existing infrastructure and launching the Palma Logistics Terminal (PLT). This 50-50 joint venture with a private company will be instrumental in supporting the offshore activities of LNG projects, such as dredging and tanker services.
Simultaneously, we’re developing a dry port to provide warehousing, production support and logistics coordination services. We have already conducted an environmental impact assessment and have secured government approval.

How do local content considerations factor into the company’s investment plans and ongoing operations?
We think of all our projects as local content initiatives. Local expertise adds value across all logistics operations, from simple transportation to specialised LNG services. CFM Logistics acts as a hub, connecting local service providers with international partners. Our goal is to generate economic benefits for Mozambique by creating local jobs.
Qualifications matter, and we insist on adherence to industry standards and require all applicable certifications. However, rather than enforcing them as a barrier, we work with local companies and facilitate training to help them meet these requirements and participate in LNG projects.

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