Oil & Gas

Dar es Salaam. The Government’s plan to increase domestic fuel storage capacity could soon become a reality, thus help to stabilise prices of the most important product in the economy.

This comes following ongoing efforts by the government aimed at making Tanzania an oil storage hub for the African Great Lakes region.

However, the plan requires massive investment in building the required infrastructure.

On October 13 this year, Energy minister January Makamba said that the government had successfully convinced friendly countries to collaborate with Tanzania in building the storage and preservation centre for fuel imported for the domestic and regional markets.

But, the Tanzania International Petroleum Reserves Ltd (Tiper) - jointly owned by the government and Oryx Energies of Switzerland - has expressed readiness to build the storage centre if entrusted with the task.

Speaking to The Citizen on the matter, Mr Makamba said Tiper’s plan is in line with the government’s strategies to improve infrastructure of fuel off-loading and storage.

“It is part of strategies aimed at increasing fuel procurement efficiency from friend countries. Already, we have started negotiating about the investment,” he said.

“The obligation will be fulfilled through Tiper whenever it is necessary for us to do so and upon mutual understanding between both sides.”

He said poor fuel off-loading infrastructure forces one ship to spend up to eight days leading to increased fuel prices in the country.

Tiper deputy director Martin Mosha said Oryx Energies was ready to invest in improving its fuel storage capacity, noting that advancement of the business would go in line with increasing profits and taxes payable to the State.

“We have started internal preparations in case we are entrusted with the job to implement expansion project of the fuel off-loading and storage infrastructures,” said Mr Mosha.

He said the company was capable of executing the job, noting however that preparations were necessary as such huge projects required huge care.

Mr Mosha said currently, Tiper has the fuel storage capacity of 254 million litres at once.

“Expansion plan of the area owned by the company will enable us to service all the fuel imported for domestic consumption and the amount on transit to neighbouring countries,” he said.

He said the move will significantly help control price of the commodity as stock could be released to the market for market stabilisation in case of unprecedented rise.

According to him, once neighbouring countries received fuel consignments through Dar es Salaam, the volume of trade between Tanzania and respective countries would significantly be strengthened.

He said Tiper was confident with its safety control and over two decades experience in storage, infrastructure and connection network between its tanks and those of fuel companies in the country and hence was ready for the crucial task for the country.