Tanzania’s Natural Gas Utilisation Master Plan (NGUMP) is ready for implementation effective this year, the government announced here yesterday.
The Japan International Cooperation Agency (JICA) funded 30-year master plan has been accomplished through collaborative efforts by various institutions and team of experts from Japan, Trinidad and Tobago.
NGUMP is an integral part of the strategy to implement the National Energy Policy, 2015 on resource utilisation, infrastructure improvement and human capital development in the country.
Industry, Trade and Investment Minister Charles Mwijage said that as the country inches closer to the gas economy, the document primarily focuses on promoting inter-sectoral coordination in the design and execution of natural gas development activities.
Presenting the Ministry of Energy and Minerals’ budget estimates for the 2017/2018 fiscal year, Mr Mwijage told the august House that while the government envisages coordinated uses of gas, detailed technical and economic analyses were vital to enable the country select the best project that will address mutual interest of the nation and investors, for implementation.
He noted that in its approach, the master plan takes into account the country’s reality and the energy sector, saying Tanzania still lacks adequate infrastructure and qualified labour to support gas development.
“With this plan, the development of the natural gas industry will contribute significantly to the Gross Domestic Product (GDP) growth and stimulate balanced economic and social development,” said the minister.
He informed the House that the document will help in identifying the current and future demand as well as supply of natural gas for local and foreign markets. It will also set financing strategy for gas utilisation projects.
According to the minister, within the 30-year period, it is expected that 18.7trl Tcf of natural gas will be used in the domestic market, with the top priority being the use of natural gas for production of electricity.
The country is also about to embark on the execution of the mega Liquefied Natural Gas plant project, the minister affirmed, saying about 13bn/- has been allocated in the next fiscal year to compensate residents who will surrender their land for the project.
The 30 billion US dollar (over 60tri/-) project, planned to sit on Lindi region’s land, according to the minister, has entered the negotiation stage of the Host Government Agreement (HGA).
The HGA is a legal agreement between the foreign investor and host government, governing the rights and obligations of each party regarding development, construction and operation of the foreign investor-run project.
International oil and gas companies Statoil, BG Group, ExxonMobil and Ophir Energy will construct the plant in partnership with Tanzania Petroleum Development Corporation (TPDC).
This year’s energy and minerals ministry budget has been pegged at 938bn/- down from last year’s 1.12tri/-. Minister Mwijage said that 94 per cent of the budget will be directed to implementation of development projects.
He further noted that the government in this financial year has revoked 2,153 mining licences whose owners failed to honour their obligations, reminding all licensees to adhere to the conditions stipulated in their permits.
The Parliamentary Committee on Energy and Minerals, Opposition Camp and a section of legislators who debated the budget estimates yesterday were perceptibly divided on the recent move by President John Magufuli on the exports of mineral concentrates.
Dr Magufuli indefinitely banned the mineral sand export following an eight-person probe team report that uncovered massive thievery in the mining sector, denying the government billions of shillings in revenue.
While Opposition Camp through its Minerals and Energy Shadow Minister John Mnyika criticized the government over the matter, the committee’s chairman Dotto Biteko described it as “a commendable move aimed at safeguarding the country’s resources which have been plundered for decades”.
Mbinga Urban MP on CCM ticket Sixtus Mapunda praised the president for the bold move that will enable the country to benefit fully from its resources.