Tanzanian Officials in Meeting with Oil Giants Royal Dutch Shell, Statoil, Exxon Mobil, and Ophir Energy over Natural Gas Plant deal

Tanzania said it is meeting executive officials from giants Royal Dutch Shell, Statoil, Exxon Mobil, and Ophir Energy to commence negotiations on basic understanding of hosting government agreement for the new gas plant.

Construction of Liquefied Natural Gas plant in East Africa’s biggest holder of natural gas reserves after Mozambique is yet to be decided. Tanzania officials say a decision on Hosting Government Agreement is vital (HGA) for the investment.

“The HGA is expected to define commercial and technical parts of the investment,” TPDC Director General James Mataragio said.

The plant which is expected to be complete by 2020 is estimated at $ 15 billion.

Local media reported that over 2,000 hectares of land have been allocated at Likong’o Village in Lindi for the construction of the planned LNG export terminal. Tanzania according to Daily News newspaper has also allocated additional 17,000 hectares near the proposed area for the two-train LNG terminal, particularly for industrial playgrounds.

Despite global concern over the prolonged fall in gas price, Tanzania maintains that it has not been affected with the new development. All natural gas production is designated for domestic consumption.

Nevertheless, TPDC has said that the dynamics in the global oil and gas prices “are not a threat but an alert’’ for the government to reposition itself ahead of the huge investment. Media reports said the slump in the gas prices is likely to hold promise of gas-fired prosperity in the developing resource rich countries.

After a continued drop, gas prices rebounded somewhat recently along with other commodities — and TPDC Director General articulates that Tanzania still has a promising future.

Credit: Daily News.

Additional reporting and re-editing by Uganda Oil Reporter

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