Tanzania to give details of $30 billion gas project in October

August 5, 2019 in Business, Energy, Foreign News, Investment by Editor

Exploration of the Tanzania’s LNG potential began just over 10 years ago with the Norwegians, British and Dutch leading the efforts.

August 4—The Tanzania government is due to give details of its future oil and gas strategy centred on developing a $30 billion liquefied natural gas (LNG) complex in the south coastal region of Lindi.

There is close to 60 trillion cubic feet of gas along offshore Tanzania with only Mozambique being the other potentially future exporter of this prized commodity along Africa’s eastern seaboard. Last June the Mozambique government announced the go-ahead of a $20 billion project to begin exploiting its 100 trillion cubic feet of deposits.

Four years ago, the Tanzania government unveiled the Songo Songo gas plant to kick-start local consumption as a cheaper alternative source of power for industries instead of imported fuels. Exploration of Tanzania’s natural gas potential began well over a decade ago.

According to the Bank of Tanzania, work on the proposed project will increase annual economic growth, which currently stands at around 7%, by another two percentage points. Several top representatives from leading resource companies will be attending the Tanzania Oil & Gas Congress which takes place between October 2 and 3 in Dar es Salaam.

LNG is widely used in heating and cooking as well as electricity generation and other industrial uses. LNG can also be kept as a liquid to be used as an alternative transportation fuel. China and Japan rank as the world’s leading customers making the LNG global market one of the most active.

Dr Medard Kalemani, Tanzania’s Minister of Energy, has confirmed his attendance at the Congress where he will give updates on the recently announced plans to commence construction of the Lindi project in 2022.

In March, the government stated that it planned to complete negotiations with a group of international oil companies in September to develop the project. A consortium of notably Norwegian, Anglo-British and American companies, are involved in the ambitious project. These international companies will work closely on the project, alongside the state-run Tanzania Petroleum Development Corporation (TPDC).

During a recent budget presentation to parliament, Dr. Kalemani said the project is scheduled to be completed by 2028 and will have capacity to produce 10 million tonnes per annum of LNG.
Currently, each individual investor of the project is holding separate talks with the government negotiation team. These talks are expected to be finalised within seven months.