Oil & Gas

Tanzania is set to auction 26 petroleum exploration blocks in its upcoming 5th licensing round, scheduled for March 2025. The announcement was made by Dr. James Mataragio, Deputy Permanent Secretary of the Ministry of Energy (Gas and Oil), during his presentation at the African Energy Week in Cape Town, South Africa, on November 5, 2024. This move is part of Tanzania's ongoing efforts to attract investment and further develop its oil and gas sector. Dr. Mataragio highlighted the country's abundant potential and the opportunities available for both local and international investors.

Of the 26 blocks on offer, 23 are located offshore in the Indian Ocean, while the remaining three are situated in Lake Tanganyika. These blocks represent significant exploration prospects, with various geological characteristics that could offer substantial returns for investors. Dr. Mataragio encouraged potential investors to collaborate with the Tanzania Petroleum Development Corporation (TPDC), particularly in the Eyasi-Wembere, Mnazi Bay North, and Songo Songo West blocks, which are already of interest due to their promising exploration potential.

To facilitate the upcoming auction, the Tanzanian government is making valuable geological data available to investors. This data includes gravity, magnetic, and seismic (2D and 3D) information, along with well data, which vary from block to block. Dr. Mataragio assured investors that the data would be readily accessible for review, allowing them to make informed decisions as they consider participation in the licensing round. The government is also working to enhance the attractiveness of the auction by reviewing its Model Production Sharing Agreement and improving fiscal terms.

In addition to the enhanced fiscal terms, which include adjustments to royalty rates, cost recovery limits, profit oil/gas splits, and state participation, Tanzania is focused on strengthening its investment climate. The government has worked to implement strategic projects, such as the Mwalimu Julius Nyerere Hydropower Project, and has over 70 years of experience in the petroleum sector. Dr. Mataragio emphasized that Tanzania’s proven petroleum systems, coupled with its government-led efforts to improve infrastructure and regulations, make it a compelling destination for oil and gas investments.