Tanzania to sell $30 billion liquefied natural gas (LNG) project

Tanzania is looking to sell a $30 billion liquefied natural gas (LNG) project within six months.

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Tanzania to sell $30 billion liquefied natural gas (LNG) project www.financialstand.com

Tanzania is looking to sell a $30 billion liquefied natural gas (LNG) project within six months after President Samia Suluhu called for a resumption of negotiations that had stalled for more than a year.

One of the developers, Equinor ASA, took a $982 million impairment on the project in January, which it said would be reversible, after failing to settle terms with Tanzania’s government. Other project partners include Royal Dutch Shell Plc, Exxon Mobil Corp., Ophir Energy Ltd., and Pavilion Energy Pte.

This will be in partnership with the state-run Tanzania Petroleum Development Corporation (TPDC).

In 2019, Tanzania’s Liquefied Natural Gas (LNG) project was put on hold after the suspension of talks between the government and foreign investors who were seeking to review the sharing agreements.

The discussions were suspended due to concerns of massive tax evasion, unfair contracts, and manipulation by companies to decrease payments to the government.

The $30 billion is projected to add another 2% points to the annual economic growth of around 7%. It will also have the capacity to produce 10 million tonnes of liquefied natural gas every year.

This will thus add 10% gas to Tanzania’s domestic use. The construction of the project is set to start in 2022.

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