01 December 2016, Kampala – Ten years ago, Uganda started oil exploration works in the Albertine and Nile basin. The phase which took 8 years attracted an expenditure of $3 billion (Shs11 trillion) causing a lot of excitement across the divide with multinationals and big oil companies showing interest and setting shop in the country.
Whereas Uganda is yet to enjoy the benefits of the resource, partners in the region have quietly moved fast and developed their resource.
Tanzania which has 50 trillion cubic feet of natural gas deposits is already producing its natural gas in Mtwara which is powering 60 per cent of the energy needs in the country.
According to According to Dr Emma Msaky, a geologist and technical advisor at office of the President of Tanzania, oil and gas advisory Bureau, the exploitation of the World Class natural gas resources discovered onshore and offshore the Ruvuma and Mafia basins created new opportunities for Tanzania to build a new economy founded on upstream gas extraction activities, as well as the downstream linked value addition industries.
The first discovery of natural gas in Tanzania in volumes of commercial significance was made in 1974 when discovery wells and their subsequent appraisal at Songosongo in Lindi Region gave resource estimates of 1 – 2.5 trillion cubic feet.
In 1982, more discoveries were made at Mnazi Bay in Mtwara Region and the resource estimates of that field stands at 3 to 5 trillion cubic feet. Currently, Tanzania has more than a dozen onshore/shallow water discovery and production wells with total resource estimate of up to 7.95 trillion cubic feet.
The production wells of Songosongo and Mnazi Bay which respectively have proven reserves of 880 billion cubic feet and 262 billion cubic feet of natural gas, produce limited fuel supplies primarily for power generation and industrialisation, as an environmentally friendly substitute to the more costly imported furnace oil and diesel.
Gas use master plan
In order for Uganda, Ghana and Tanzania people benefit from the resources, a strong legal framework is required to improve local participation in the extractive industry.
According to Ms Lugangira, Tanzania has a Natural Gas Utilisation Master Plan which among other issues, gives direction on how natural gas can be used locally. In its intent to protect local interests and steer economic growth in the economy, Tanzania has decided that 10 per cent of the gas produced will be dedicated to the domestic market whether it will be used or not.
Dr Msaky says the government is already converting the gas into Liquefied Natural gas for cooking in homes and launching stations for gas stations for refilling cars.
“We used to face a lot of load shedding in the country; this is no longer the case. The natural gas generates electricity which powers over 61 industries in Dar es salam,” she said.
She also said there plans to build a pipeline to Mwanza to supply electricity to the region which is also an industrial hub for Tanzania.
At the Tanzania Electric Supply Company Limited (TANESCO) power generation site in Kinyerezi, which is run Chinese, the government has signed a partnership with the Chinese firm running the site which will see Tanzania locals trained in running the plant as a way of taking over the management in future.
Several Tanzanian locals are employed at the Tanzania Petroleum Development Centre where the gas is processed into Liquefied Natural Gas before being transported in a pipeline to Msonga Fungu where it is compressed and transported to Dare es Salam TANESCO power generation plant in Kinyerezi
Mr Raphael Mbena, the country office manager of the Maurel and Prom Exploration and Production Limited, a gas processing facility located at Mtwara in the North-Western part of Tanzania, said 98 per cent of the company’s workforce is local employees. He told reporters on a field visit to the plant site at Msimbate that the gas recovery facility employed 78 people with only two expatriate workers.
- The Monitor