Tanzania will resume negotiations with International Oil and Gas companies (IOCs) on its Liquefied Natural Gas projects later this month, local media reports.
Talks between the Tanzania Petroleum Development Corporation (TPDC) and the IOCs stalled for about a year following the government’s decision to review Production Sharing Agreements (PSAs) and scrap certain provisions which the President John Magufuli administration rendered contrary to its mineral and petroleum proceeds policy.
The government and project developers were expected to have concluded the negotiations by September 2019, and give way to a Final Investment Decision (FID).
TPDC Communications manager Marie Msellemu was quoted by local newspaper The Citizen in December as saying that the government was finalizing the land acquisition exercise for the Lindi LNG project.
“We accumulated interest for two years that we hope to finalize payment by end of this December,” she said, adding that once the payment was completed they would resume negotiations.
Partners in Tanzania’s Gas project include; Shell Tanzania together with its partners Ophir Energy and Pavilion Energy. Others include Equinor, Block 2 operator together with partner ExxonMobil.
While Tanzania’s LNG project is being delayed, its southern neighbor, Mozambique, is progressing with development.
French Major Total reached a $20 billion Final Investment Decision in 2019 and was working out to deliver LNG in 2024.
Total’s project is one of several projects being developed in the country’s northernmost province of Cabo Delgado after one of the biggest gas finds in a decade off its coast. Together, the projects are worth some $60 billion.
Rival Exxon Mobil delayed the final investment decision on its nearby Ruvuma LNG gas project due to the coronavirus pandemic, and Mozambique expects the decision next year.
With 150 trillion cubic feet (TCF) of liquefied natural gas (LNG) reserves, equivalent to 24 billion barrels of oil, Mozambique is positioning itself as the world’s next big global energy player.
With about 57.7tcf of natural gas reserves, Tanzania also offers endless opportunities for investors in the oil and natural gas sectors.
© Contains files from The Citizen Newspaper