Oil & Gas

Tanzania’s Deputy Minister of Energy, James Mataragio, has announced that the country will host a national meeting with investors, banks, and regulators to address financial barriers hindering the construction of compressed natural gas (CNG) fueling stations. The government’s aim is to make CNG widely accessible as a cheaper and cleaner alternative to gasoline. Private companies are already responding, with BQ Construction planning a station for 180 vehicles per day and Puma Energy preparing to launch four CNG stations in the coming months.

Drawing inspiration from Nigeria, Tanzania is looking at how CNG can reshape its fuel market. Nigeria, Africa’s top oil producer, has secured $700 million in CNG investments in 2024 alone. With government support, CNG prices in Nigeria are four times cheaper than gasoline, drastically lowering transportation costs. Authorities there are aiming for one million CNG-powered vehicles by 2027 with more than 90 fueling stations under construction.

For Tanzania, the shift is not just about reducing fuel prices but also about strengthening energy security and diversifying its economy. The country’s offshore gas resources hold potential to turn it into a regional gas hub while also supporting the government’s goal of pursuing a low-carbon energy path. By building a robust CNG sector, Tanzania hopes to cut costs and reduce reliance on expensive imported oil.

A study by Dairy Hills shows that CNG can reduce energy costs by up to 58%. However, experts caution that success will depend on building reliable infrastructure, training skilled workers for vehicle conversions, and creating an attractive investment environment. If Tanzania follows Nigeria’s model, the country could see both cheaper transport for its citizens and stronger long-term energy resilience.