The recent discovery of extra natural gas reserves in Tanzania could turn Eastern Africa into a world oil hub business experts have expressed optimism.
Tanzania announced an increase in its gas deposits in the last 12 mouths following a number of discoveries in offshore blocks. The discovery of new Oil deposits in the East African state is seen as a ray of hope as the nation struggles to balance it Current Account deficit.
According to a statement by Tanzania Energy and Mineral Minister, George Simbachawene, the newly discovered reserves has posted an increase of 18% making the total reserves at 55.08 trillion Cubic feet from the earlier 46.5.
“As a result of ongoing exploration activity, natural gas resources discovered in the country rose from 46.5 tcf in June 2014 to 55.08 tcf in April 2015, equivalent to an increase of 18 per cent,” George Simbachawene, Tanzania’s energy and minerals minister, said in a presentation to parliament on Saturday.
Business analysts have capitalized on the announcement to assert that the discovery of gas reserves in Tanzania and its neighbor Mozambique and other East African states positions the region into a prospectus world Oil hub status.
More than 100 Tcf of natural gas have already discovered in neighboring Mozambique. Meanwhile the United States Geological Survey estimates that East Africa’s coastal region has potential reserves of up to 441 Tcf of natural gas.
Simbachawene in his parliament address said the government of Tanzania is working on a pipeline project which will connect the oil rich southeastern coast to the port city of Dar-es-Salaam. The project is planned to commence in September.
Along with the pipeline, Tanzania is also finalizing plans to start a Liquefied Natural Gas (LNG) Factory in the Southern Town of Lindi.
According to the data from Energy and Minerals Ministry, about TZshs 12 billion ($6 million) in the 2015/2016 financial year has been allocated for the assessment and compensation of 450 people living where the LNG plant will be built.
In Last month, Tanzania launched a team of 25 experts from different government departments to act as official negotiators in all natural gas and oil contracts with international oil companies (IOCs) so as to tap the best deals for the socioeconomic benefit of Tanzania and its people.
Energy ministry spokes person said that the budding gas sector will save the nation close to $ 1 billion spent in energy subsidization, oil importation and electricity generations annually.