Zimbabwe opens Cabora Bassa to oil, gas investors

Government has opened the Cabora Bassa Basin to international investors for oil and gas exploration while declaring coal a "special critical mineral" as it intensifies efforts to unlock domestic energy resources, reduce fuel imports and drive industrialisation.

The policy shift marks a new phase in Zimbabwe's strategy to turn its largely untapped energy resources into a foundation for power generation, fuel production and downstream industries.

It comes as Australia-headquartered Invictus Energy advances exploration in Muzarabani and Mbire districts, where it has invested about US$100 million since 2022 in a 700 000-hectare prospective area.

The emerging potential of the basin has attracted international attention following Invictus' Mukuyu discovery, while drilling of another high-impact well, Musuma-1, is scheduled to begin in November.

Government believes opening the wider basin to international investors could accelerate exploration by bringing additional capital, technology and expertise into Zimbabwe's developing oil and gas industry.

Mines and Mining Development Deputy Minister Engineer Caleb Makwiranzou announced the policy shift while addressing international investors at the Africa Down Under conference in Perth, Australia, last week.

"Government has recently classified coal as a special critical mineral, and we are directing investment towards clean coal technologies, coal-to-liquid fuel, coal bed methane development, gas exploration, in particular in the Muzarabani basin," he said.

The new policy direction places energy security at the centre of Zimbabwe's strategy to make the mining sector more attractive to long-term investors.

Rather than limiting coal to conventional power generation, Government wants to promote technologies that can convert the resource into transport fuels, chemicals and gas, while also developing coal-bed methane and other downstream industries.

If exploration establishes commercially viable quantities of gas in the Cabora Bassa Basin, the resource could provide a domestic source of energy and industrial feedstock, potentially supporting industries such as fertiliser, glass and steel manufacturing, as well as energy-intensive mineral processing.

Domestic energy production could also reduce Zimbabwe's dependence on imported fuels and strengthen security of supply.

Government is particularly interested in developing energy resources alongside the country's mineral-processing ambitions, with locally available gas potentially supporting value addition in sectors such as lithium and platinum group metals.

The development of the Cabora Bassa Basin therefore fits into the Second Republic's broader industrialisation agenda, which seeks to move Zimbabwe beyond the export of raw minerals and establish industries around its natural resources.

Invictus Energy's exploration programme has placed the basin firmly on the international oil and gas map.

The company announced a significant oil and gas discovery at the Mukuyu structure in 2023 after drilling two wells in the approximately 200-square-kilometre structure.

The discovery, involving the Lower and Upper Angwa formations, has an estimated resource potential of about 230 million barrels of oil equivalent, or 1.3 trillion cubic feet of gas.

The figures represent exploration resource potential and will require further appraisal, development and commercial assessment before recoverable commercial reserves can be established.

Invictus has since moved into the next phase of its exploration campaign, with Musuma-1 expected to provide another major test of the basin's hydrocarbon potential.

The well will test a separate prospect at a time when Government is seeking to attract more international players into the basin.

For investors, the combination of existing exploration results and a largely underexplored petroleum province presents an opportunity to participate at an early stage of development.

The Muzarabani basin has been described as an "open and largely uncontested field" for investors, with potential for both conventional gas and coal-bed methane development.

Authorities have identified energy security as one of 12 priority areas in efforts to make Zimbabwe's mining sector more bankable for long-term investment.

This is particularly important because mining projects require reliable and affordable electricity, while Zimbabwe continues to spend substantial foreign currency importing petroleum products.

Unlocking domestic sources of gas and coal could therefore address two challenges simultaneously — supplying energy to industry while reducing pressure on the import bill.

Makwiranzou said Government was putting in place the policy, fiscal, energy and logistics architecture required to attract international capital into the mineral sector "profitably, securely, and for a long time".

"For an investor contemplating a 20- or 30-year programme in Zimbabwe, that predictability matters as much as the grade of the mineral that you are mining," he said.

Government is also working with institutions including the African Export-Import Bank, African Development Bank and Infrastructure Development Bank of Zimbabwe to support bankable resource projects.

Makwiranzou also cited the Victoria Falls Stock Exchange as a hard-currency platform capable of providing an additional route for investment into the mining and energy value chain.

He said Zimbabwe was deliberately building an investment environment backed by the "full weight of the State", with fiscal terms, remittance guarantees and arbitration frameworks designed to provide comfort to institutional investors.

The energy push is also being supported by measures allowing independent power producers to operate within the mining value chain.

Under the emerging framework, large mining projects can build their own power plants, contract independent producers or use power-wheeling arrangements.

The move is intended to enable mining companies to secure dedicated electricity while reducing pressure on the national grid.

It also creates opportunities for new energy projects linked to Zimbabwe's mineral economy, particularly as mines expand production and Government pursues greater beneficiation.

The availability of reliable power is increasingly important as Zimbabwe seeks to develop energy-intensive processing industries rather than exporting minerals in raw form.

The reclassification of coal as a special critical mineral is another significant element of the strategy.

Zimbabwe has substantial coal resources, traditionally associated primarily with thermal power generation. Government now wants to expand the resource's economic role through clean-coal technologies, coal-to-liquid fuel production and coal-bed methane extraction.

The objective is to develop domestic alternatives for transport fuels and industrial inputs while creating new value chains around a resource that has historically been viewed mainly through the lens of electricity generation.

Makwiranzou said the policy was designed to leverage Zimbabwe's coal resources to produce transport fuels, chemicals and gas, thereby reducing the fuel import bill and creating new industrial opportunities.

The strategy could become particularly significant if linked to the country's broader push for mineral beneficiation, where energy availability and cost remain critical determinants of competitiveness.

The renewed focus on energy resources comes against the backdrop of strong growth in Zimbabwe's mining sector.

In the first half of the year, mineral export earnings reached an estimated US$5.7 billion, with gold accounting for about US$3.2 billion.

Government expects to surpass both its 2026 annual target and the US$8.6 billion in mineral revenues recorded last year.

The figures underscore the central role of mining in Zimbabwe's foreign-currency generation and the potential economic impact of developing new resource sectors.