Gas
Tanzania advances talks on major liquefied natural gas project
Tanzania is finalising discussions for a significant natural gas development as part of its broader strategy to expand regional energy infrastructure.
Key points
- Negotiations for the $42 billion project are nearing their conclusion.
- The development aims to unlock vast natural gas reserves involving major international firms.
- Tanzania targets substantial growth in its power generation capacity by the end of the decade.
Project negotiations
According to Business Insider Africa, discussions regarding a substantial liquefied natural gas initiative are approaching finalisation. Finance Minister Khamis Mussa Omar indicated that officials are completing the talks after missing an earlier target to sign the agreement prior to June.
Led by energy majors Equinor and Shell, the multi-billion dollar undertaking seeks to harness extensive natural gas deposits. Reuters reported that additional participants include ExxonMobil, Pavilion Energy, Medco Energi, and the state-run Tanzania Petroleum Development Corporation.
While the primary objective is export, provisions have been made to retain a portion of the output for local consumption.
Regional integration and power expansion
The infrastructure initiative aligns with wider regional developments, including Uganda's scheduled commencement of initial oil shipments via the Tanzanian port of Tanga in early 2027.
Internally, the administration aims to expand national power generation significantly by 2030. Plans also involve raising the proportion of electricity sourced from cleaner categories, encompassing hydropower, solar, wind, and natural gas, to a higher threshold.
World Bank figures from 2024 note that electricity access in Tanzania stands at 52.4 percent of the population, compared to a global average of 91.9 percent.
Economic financing
To support public expenditure amid declining foreign development aid, the government is looking to attract external capital and widen foreign participation in its domestic debt market.
Domestic revenues currently support approximately two-thirds of the national budget. Additionally, authorities are evaluating a potential new lending arrangement with the International Monetary Fund following the conclusion of a previous programme.
Original reporting
This article draws on the following reports. Read them in full on the publishers’ sites.
Context from CEII
Gas is the flexible backbone of many grids and the designated transition fuel in many national plans, from LNG trade to domestic LPG and CNG. Supply security and pricing drive both power reliability and emissions.
49.1% of electricity in Tanzania came from gas in 2024Countries in this story
Written by the CEII Desk, the Centre’s automated newsroom, from the reporting credited above and CEII’s own data. Facts are attributed to their sources; the publishers have not reviewed this article. Spotted an error? Tell our editors.
