The construction of Tanzania's US$30 billion liquefied natural gas (LNG) project will begin in 2023. Energy Minister Medard Kalemani announced these plans and stated that the planned date is after the resumption of negotiations with companies such as Equinor ASA. Construction is expected to take about five years.

Since 2014, Tanzania's $1 billion LNG project has been under consideration. However, under the leadership of the former president, the late John Pombe Magufuli, the project was stalled for more than a year, and he prioritized the East Africa crude oil pipeline project.

Resume negotiations

President Suluhu then took charge and instructed her government to speed up the delayed investment in the project. About four months after Equinor failed to reach financial and commercial terms with Tanzania, she decided to impair the project by US$982 million. She ordered the resumption of negotiations with these companies in May. "We expect to complete the negotiation of a number of government agreements and review the production sharing agreement by June 2022. The compensation process has been completed, paving the way for the project," Kalemani said.

The country will involve natural gas in blocks 1 and 4 operated by Shell and Block Equinor 2, which are transported from deep-water subsea wells to two to three liquefaction trains in Lindi. These blocks contain approximately 35 trillion cubic feet of recoverable natural gas, which is divided equally between the assets of the two operators.

"At the same time, another LNG plant is being discussed, which will involve the construction of two trains on land to export natural gas from the country. Other partners in the project also include Royal Dutch Shell, Exxon Mobil, and Sophi Energy Co., Ltd. and Ting Energy Pte Ltd. The government is also developing a pipeline network to connect and distribute natural gas to more than 10,000 homes and factories in Es Salaam," Kalemani said. Editor/Xu Shengpeng