This study critically examines the engagement of Empresa Nacional de Hidrocarbonetos (ENH), Mozambique’s national oil and gas company, in financial arrangements involving Special Purpose Vehicles (SPVs), particularly considering the fiscal benefits for international gas consortia that utilize SPVs. The rerouting of loans for the Coral Sul project through an SPV located in the United Arab Emirates (UAE) is expected to result in withholding tax losses ranging from 100.7 million USD to 276.6 million USD. Moreover, our analysis indicates that guarantees issued by the gas consortium for ENH’s involvement in the project financing of the Coral Sul project could reduce Mozambique’s corporate income tax revenues by up to 68.9 million USD, due to the treatment of these financial guarantees as deductible expenses. The findings underscore the complex relationship between Mozambique’s fiscal stability and the hydrocarbon sector’s transnational financial activities, advocating for enhanced fiscal transparency and strategic policy interventions.
