The Untold Story Of Mtwara Gas

A lot has been alleged concerning the gas matter in Mtwara something which led me to ask myself is it a curse or blessing that we have finally found what God has blessed the land of Tanzania with.

 Mtwara region did not have great attention from the media and was regarded as sleeping giant multinational corporations or the Tanzania government until the discovery of oil and gas something which grasps attention of the whole world.

Tanzania has, for decades been involved in extractive industries exploration, development and production. The country has excellent opportunities for oil and gas exploration and development in the ‘unexplored’ but highly potential sedimentary basins.

I have realised that it is important that Tanzanians are aware of the main players in the oil and gas industry in the country. It is feared though, that lack of information, together with weak public knowledge about the institutions involved, may cause complications for public access to oil and gas appropriate information.

 

As it seems like at the first place there were conflict of interest which led to riots and the community at large was not having a good knowledge about gas which I believe up-to-date though the government through Ministry of Energy and minerals has sent some community members to Thailand for training concerning the gas issue still some people are not pleased.

Lessening information gap in the oil and/or gas industries is vital for reinforcing transparency and accountability along the value chain of the duo extractive industries in Tanzania, especially now when the country is the ExtractiveIndustries Transparency Initiative (EITI) implementing country.

The Msimbati Bay is potential for natural gas where large deposits have been discovered. Exploitation programmes are yet to be concluded and this could yield the region and neighbours with an abundant alternative source of domestic energy.

Since 2005, however, and especially in the last couple of years, far more interest has been paid to the region in light of massive offshore natural gas discoveries. Now more than ever, southern Tanzania (and particularly Mtwara town) is in the process of being dragged into the global capitalist economy – notwithstanding the infamous Groundnut Scheme.

These opposition parties are gaining traction in calling for greater transparency over the contracts that the government has signed with natural resource extraction companies. There are further demands for the publication of all of the contracts signed with foreign governments, especially regarding the construction of the pipeline from Mtwara to Dar es Salaam that is to be funded with a discounted loan from the Chinese government.

 

Failure to manage expectations surrounding the natural resource discoveries coupled with an existing perception of a ‘hidden agenda’ against Mtwara. Whether such an agenda exists is secondary to the perception it does, and this should have been considered in all dealings. The most sceptical analysis might point to the failure to learn key lessons from the Niger Delta in spite of a rhetorical claim to have done so.

However, this seems to believe the fact that the companies working on gas extraction in Mtwara are predominantly from Europe and North America such as BG Group (UK), Statoil (Norway), ExxonMobil (US), Ophir (UK). Brazilian company Petrobras – an increasingly significant global actor – is also involved, while the only major and publicised Chinese involvement is the aforementioned low cost loan for the construction of the controversial pipeline.

 Spreading such thinly-veiled rumours is perhaps a diversionary tactic to absolve the Tanzanian government of the burden of responsibility, which would make sense in light of how excessive the response of the police and the army seems to have been.

Tanzania is endowed with diverse energy sources including biomass, natural gas, hydropower, coal, geothermal, solar and wind power, much of which is untapped. Wood-fuel accounts for up to 90% of total energy supply with about 2% from hydro-electricity and 7% from oil-derived products and 1% from other sources. Nonetheless the downstream oil industry is an important sector of the country's economy absorbing on average 55% of the country's foreign exchange earnings.

Government policies are directed at petroleum product substitution by exploiting indigenous resources. In the upstream oil industry, oil and gas exploration and production is also being encouraged. Extensive gas fields have been identified off the coast at Songo Songo and Mnazi Bay which are currently under production, and the just discovered gas fields off Mafia Island shores that are being developed.

Current natural gas resources are estimated to be 40 trillion cubic feet (tcf), which is quite substantial. At present, most of the gas produced from these fields is used in power generation. However, natural gas can be a raw material for a multitude of more valuable petrochemical industries.

The human resource is certainly the most important factor of production because it is capable of transforming all the other factors for the betterment of human life and human welfare. Developing and utilising this resource effectively increases its productivity and its capital value. Thus, human resources development must be one of the leading objectives on the nation's development agenda.

Given significant discoveries of natural gas, there is apparent demand for petroleum and petrochemical engineers. There is a need to exposing this potential and disseminate the status of the industry particularly its potential contribution to the development of Tanzania.

speaking about potential benefits to Tanzania only 0.3 per cent of the total sales on gas would be retained to run various social and economic activities for the people of Mtwara and Lindi regions.

Other benefits are construction of fertilizer and cement industries. America’s Symbion company branch would be set up in Mtwara Municipality for the generation of 400 Mw of electricity.

Additionally, a transmission line of KV 220 would be constructed from Mtwara to Songea by the US Schlumberger company based in Houston, which is currently constructing a big equipment workshop for gas and oil extraction.