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Tanzania completes talks

on $30bn LNG project

TANZANIA TANZANIA has concluded negotiations on a Equinor and Shell, along with their non-oper-
$30bn LNG project with Equinor (Norway) and ating partners ExxonMobil (US), Ophir Energy
Shell (UK), creating an opportunity for launch- (UK) and Pavilion Energy (Singapore), plan
ing the development of the country’s vast off- to build the LNG plant in Tanzania’s southeast
shore natural gas resources after years of delay. Lindi region.
The successful completion of talks was The facility will eventually have two gas lique-
announced by Tanzania’s Ministry of Energy in faction trains with a production capacity of 5mn
a Twitter post on March 6, Reuters reported. tonnes per year (tpy) each.
In the post, Energy Minister January The Energy Ministry did not say exactly when
Makamba noted that the parties had wrapped it expected work on the LNG plant to begin. Tan-
up negotiations on the construction of an LNG zania Petroleum Development Corp. (TPDC),
plant and that experts were now working to draft the national oil company (NOC), had said last
the contracts needed to support the project. year that it hoped to see construction start in
These contracts include a host government 2023 and finish in 2028.
agreement (HGA), as well as a combined con- Tanzania is already a gas producer and has
tract for the development of the offshore sites put some of the volumes produced from offshore
known as Blocks 1, 2 and 4, which will supply fields such as Songo Songo to use to run thermal
natural gas for the onshore LNG plant, the min- power plants (TPPs) and manufacturing facili-
istry explained. ties. It also aims to build a fertiliser plant that will
According to previous reports, Shell holds the use domestically extracted gas as feedstock.
licence for Block 1 and Block 4, which are esti- As of June 2022, the government estimated
mated to hold 16 trillion cubic feet (453bn cubic the country’s total recoverable gas reserves at
metres) of gas in recoverable reserves. Equinor 57.54 tcf (1.63 trillion cubic metres). Accord-
operates Block 2, in which ExxonMobil holds a ingly, the development of the blocks that will feed
stake and is estimated to hold more than 20 tril- the Tanzania LNG project will raise the reserve
lion cubic feet (566.4 bcm) of gas. figure.™

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