Construction works on US $30bn liquefied natural gas (LNG) project in Tanzania is set to begin in 2023. Energy Minister Medard Kalemani revealed the plans and said the decision comes after resumption of talks with companies including Equinor ASA.
The project was sidelined under the administration of the former President, the late John Pombe Magufuli with his administration instead prioritising the East Africa Crude Oil Pipeline to take oil from Uganda to the Tanzanian port of Tanga.
“We expect to conclude negotiations for a number government agreement and review production sharing agreements by June next year. Compensation process have been finalized to pave way for the project,” said Kalemani.
Read:Total to declare force majeure on its Mozambique LNG project
Developing unique competencies and capabilities
The project will see the country involving gas from Shell-operated blocks 1 and 4 and Equinor’s Block 2 being piped from deep-water subsea wells to two or three liquefaction trains at Lindi. These blocks house about 35 trillion cubic feet of recoverable gas, split about evenly between the two operators’ assets.
According to Shell, the offshore deepwater gas in the south of Tanzania is located in fields over 100km offshore, and some are in water that is up to 2,500m deep and 2,500m below seabed. Distance between the fields can also be over 100km apart.
Depth, distance and terrain means the Tanzania LNG project is at the cutting edge of deep sea exploration technology and provides a unique opportunity for developing unique competencies and capabilities in the local supply chain and within TPDC as the project tackles these technical obstacles.
“Meanwhile, discussions are ongoing on another LNG plant which will involve construction of a two- train onshore that will export gas from the country. Other project partners include Royal Dutch Shell Plc, Exxon Mobil Corp., Sophi Energy Ltd. and Pavilion Energy Pte Ltd. A pipeline network to connect and distribute gas to more than 10,000 homes and factories, in the Dar es Salaam is also being developed by the government,” said Kalemani.
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