How Tanzania is Bagging Billions in Natural Gas Investments
Tanzania liquefied natural gas front has received a $30 billion shot in the arm from large energy companies including Equinor and Exxon Mobil.
Tanzania has an estimated 57 trillion cubic feet of natural gas reserves
ExxonMobil, Equinor and Shell are among two top energy giants investing in Tanzania gas
Tanzania has secured a $30 billion investment in its LNG project
Tanzania's natural gas reserves have just proven to be extremely necessary for the nation's economy and energy sector at large.
On April 29, Tanzania took the extractive sector to another level by nailing an agreement with exploration companies to construct a vast liquefied natural gas (LNG) plant worth $30 billion.
Tanzania's LNG sector presents a necessary power generation and consumption potential, and the plant is just a success story for Tanzania.
According to information from The Citizen, a team of experts is currently in negotiations with five oil and gas firms - Shell, Equinor ExxonMobil, Pavillon and Ophir as the project will be executed in the Lindi region, south of Tanzania.
Natural gas in Tanzania has become one of the key components in transforming the Tanzania energy sector into a regional lighthouse.
Natural gas in Tanzania is the new gold. Under President Samia Suluhu Hassan's administration, the government has managed to unlock as much as $30 billion in foreign investment.
According to the chief negotiator and the acting director-general of the Petroleum Upstream Regulatory Authority (PURA), Charles Sangweni, the negotiations--which began last year, are on track.
The chief argued that the negotiations expected to attain the government's goals would be marked by May 31.
"We expect that by May 31 this year, we will have entered into the initial Host Government Agreements (HGAs), which will pave the way for more comprehensive negotiations", the chief noted.
Tanzania has an estimated 57 trillion cubic feet with a total annual production of 110 billion cubic feet from three fields: Songo Songo, Mnazi Bay, and Kiliwani North (Tanzania Invest). The reserves are in the Indian Ocean and offshore.
The essential project is overseen by the collaboration between Tanzania Petroleum Development Corporation (TPDC) and international oil and gas companies (IOCs).
The chief also noted that the actual construction would take four to five years before operations began.
The project won't only enhance LNG in Tanzania but also improve job creation as more than 5,00 jobs would be created during the construction phase and 4,000 to 6,00 jobs created during operations.
The journey towards success has been paved with collaboration. TPDC hired a UK law firm, Baker Botts, as the Transaction Adviser to the government negotiation team and TPDC regarding the development of a liquefied natural gas (LNG) project in the country.