Editor’s Note: This article was originally published by DAILY NEWS
DODOMA: THE government yesterday said it will conclude negotiations for the 42 billion US dollars (over 100tri/-) Liquefied Natural Gas (LNG) project between the government and investors in the next financial year.
Minister for Energy, Mr Deogratius Ndejembi, told the National Assembly while presenting his ministry’s 2.53tri/- budget estimates that the government will also prepare implementation agreements for the project between the government and investors.
He said his docket will also prepare and implement a land-use plan for the project area and will participate in the preparation of the project development plan.
“The ministry will also continue providing education and raising awareness among citizens on the opportunities and benefits of the project,” he said.
The Minister noted that a total of 20bn/- from domestic revenue has been allocated for the implementation of the activities.
Mr Ndejembi said that through the project, Tanzania will gain international recognition in the LNG business, while government revenues from natural gas sales will increase.
He added that the project will also boost investment in natural gas exploration and development in the country, thereby strengthening the growth of various economic and social activities.
The Minister further said that domestic use of natural gas will increase as well as foreign exchange earnings for the country.
In addition, he said the LNG project will create more opportunities for the participation of Tanzanians and local companies in the gas value chain.
Recently, Prime Minister Dr Mwigulu Nchemba assured the National Assembly that the LNG mega-project is on track.
Responding to an impromptu question in the Prime Minister’s Questions session, the Premier noted that while the project is strategic, several complex issues must be resolved before its commencement.
“Discussions are underway. Given the unprecedented scale of this investment, it is prudent for the government to be meticulous to ensure our national resources are properly safeguarded,” Dr Mwigulu said.
The Host Government Agreement (HGA) is expected to be signed mid this year, a critical milestone that must precede the Final Investment Decision (FID). Jointly operated by Equinor and Shell, the project aims to unlock approximately 47.13 trillion cubic feet of natural gas.
Other key partners in the consortium include ExxonMobil, Pavilion Energy, Medco Energi and the Tanzania Petroleum Development Corporation (TPDC).
The Prime Minister informed lawmakers that while the initial plan focused solely on exports, the government is now negotiating to retain at least three per cent of the extracted gas for domestic consumption to meet growing local energy demand.
Another priority in the talks is the participation of Tanzanian companies.
