Oil & Gas

Tanzania is currently negotiating with investors over tax incentives for a $42 billion liquefied natural gas (LNG) plant project, which has been stalled due to proposed government changes to a financial agreement made in 2023. Energy Minister Doto Biteko stated that the talks could be completed by June, as discussions continue to address the project's viability. Equinor and Shell are joint operators of the mega gas project, with Exxon Mobil, Pavilion Energy, Medco Energi, and Tanzania's national oil company TPDC also involved as partners.

Biteko emphasized that despite the setbacks, the project has not stopped, and negotiations are ongoing to make it feasible for all parties involved. He noted that some government incentives would be necessary to move the project forward, and the final production volume will depend on the outcome of these talks. Biteko expressed hope that the negotiations would conclude by June, within this financial year, allowing the project to proceed.

Once completed, the LNG project will unlock an estimated 47.13 trillion cubic feet of natural gas reserves in Tanzania, marking a significant milestone for the country’s energy sector. In addition to the LNG project, Tanzania is preparing to launch an exploration licensing round for 26 oil and gas blocks on March 5. These initiatives are expected to further enhance the country’s position as a key player in the energy market.

Furthermore, Tanzania is collaborating with France’s TotalEnergies and China’s CNOOC, along with Uganda, to develop a 1,445-kilometer-long pipeline to transport Ugandan crude oil to Tanzania's Indian Ocean coast. Biteko confirmed that construction of the pipeline is progressing well, with 47% of the project already completed. He anticipates that the pipeline will be finished in about 36 months, marking another major step in the region’s energy infrastructure development.