Post-election protests in Mozambique force Syrah Resources to declare Force Majeure
Australian mining company Syrah Resources has declared force majeure on operations at its Balama graphite mine in Mozambique’s Cabo Delgado province due to escalating post-election protests. The company evacuated most of its workforce to ensure their safety amid growing instability in the region.
The Balama mine is one of the world’s largest sources of natural graphite, with an annual production capacity of around 350,000 tons. The facility plays a strategic role in the global supply of graphite, a critical component for batteries used in electric vehicles and electronic devices. The suspension of operations now jeopardizes Syrah’s ability to meet its supply contracts.
The declaration of force majeure also impacts Syrah's financing agreements with the U.S. International Development Finance Corporation (DFC) and the U.S. Department of Energy. The company is currently negotiating with these entities to address the breaches and secure continued funding.
Mozambique's post-election unrest, triggered by the contentious results of the October elections, has disrupted key economic sectors. Besides Syrah Resources, Australian company South32 recently suspended its production forecasts for the Mozal Aluminium smelter due to the political and social instability in the country.
Syrah Resources’ stock dropped more than 28%, reflecting investor concerns over the disruptions at the Balama mine. The company reaffirmed its commitment to employee safety and pledged to resume operations as soon as security conditions allow.
The political crisis in Mozambique is having profound implications for the national economy, eroding investor confidence and halting industrial activities critical for both the country and international markets.
Sources: Reuters, Syrah Resources
