Page 7 - GLNG Week 15 2021

GLNG AFRICA GLNG

Tanzania’s new president aims

to push LNG project ahead

PROJECTS & NEW Tanzanian President Samia Suluhu Has- south-eastern part of the country. The facility
COMPANIES san said last week that she wanted to push a would use gas from three deepwater offshore
long-delayed LNG project led by Equinor (Nor- sites containing about 35 trillion cubic feet
way) and Royal Dutch Shell (UK/Netherlands) (991bn cubic metres) – Block 2, assigned to
forward. Equinor, and Blocks 1 and 4, assigned to Shell –
Speaking at a ceremony marking the formal as feedstock for LNG production.
appointment of her new cabinet ministers and Equinor has expressed scepticism about the
their deputies, Hassan instructed the country’s viability of Tanzania LNG. Earlier this year, the This week,
Ministry of Energy to bring negotiations on the Norwegian major wrote the book value of the
$30bn Tanzania LNG project to a close as quickly project down by $982mn, saying that its break- Shell and
as possible. She also requested that the ministry even price was likely too high to be profitable.
work to determine whether the scheme was fac- It has stopped short of abandoning the scheme, Equinor urged
ing any specific obstacles. though, and said it may resume work at a later
“It is time to know if the project is viable or time. the Tanzanian
not and understand who is blocking it,” she said. Indeed, this week, Shell and Equinor urged government to
These measures will allow Tanzania’s gov- the Tanzanian government to take immediate
ernment to decide whether to continue working action to conclude talks over the project, warn- take immediate
with Equinor and Shell or to look for another ing that the window for developing new gas
partner, she added. “If the existing investors are resources was limited. action to
not willing, then you [the ministry] must find Meanwhile, the project is running far behind
others,” she declared. schedule. Tanzanian officials had previously said conclude talks
James Mataragio, the managing director they hoped to sign a host government agreement over the project.
of Tanzania Petroleum Development Corp. (HGA) with Shell and Equinor in 2019, and this
(TPDC), responded to Hassan’s statements by would have allowed the two majors to begin
calling an emergency meeting with senior mem- work in 2022. However, these deadlines were
bers of his staff. “We [TPDC] have to think and not met, partly because of commercial disputes
discuss what to do,” he told The Citizen. between the companies and the government and
The Tanzania LNG project envisions the partly because Hassan’s predecessor John Magu-
construction of a gas plant with two or three liq- fuli made the East Africa Crude Oil Pipeline
uefaction trains in Lindi, a coastal town in the (EACOP) project a higher priority.™

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