Oil & Gas

TANZANIA expects to sign before June a deal for its long-stalled $42 billion liquefied natural gas (LNG) project, a senior government minister has said, with production projected to begin in about eight years. The project represents the largest single investment ever planned in the country and is viewed as a major step toward transforming Tanzania into a key global gas producer.

The LNG project is jointly operated by Equinor and Shell, with Exxon Mobil, Pavilion Energy, Medco Energi, and Tanzania’s national oil company TPDC as partners. It is expected to unlock an estimated 47.13 trillion cubic feet of natural gas, and together with similar developments in Mozambique, could help position East Africa as an emerging LNG export hub serving Asian markets.

The project had stalled following proposed government changes to a financial agreement reached in 2023, but authorities say negotiations are now nearing completion. Minister of State for Planning and Investment Kitila Mkumbo said commercial discussions have been concluded, with talks now focused solely on the legal framework required due to the unprecedented scale of the investment.

Mkumbo said the deal is expected to be signed before June and could create more than 100,000 jobs, adding that the government has instructed the central bank to sell part of its gold reserves to fund infrastructure projects. His remarks come as international partners have withheld between $2 billion and $3 billion in development support following political unrest linked to last year’s election, though the government maintains the LNG project signals renewed investor confidence.