Potential Aplenty: Tanzania Eyes Hydrocarbon Boom

“We have a lot of potential, but not all of the investors know it,” says Fabian Mwose, Senior Petroleum Engineer at Tanzania’s Petroleum Upstream Regulatory Authority (PURA), to FORBES AFRICA, revealing the nation’s untapped hydrocarbon reserves to be north of 57.5 Trillion cubic feet (Tcf). 

To put this into context, Tanzania currently produces 230 million standard cubic feet (SCF) of gas–not enough to export, but enough to have engaged the domestic market. 

“We have more than 50 local industries using gas, so the cost of production has gone down, and some of the materials that we used to import from abroad are now being produced locally, particularly for the plastics and deliveries,” Mwose says on the sidelines of last week’s Africa Energy Week in Cape Town.  

Much of the potential lies offshore, responsible for around 80% of discoveries with reserves of roughly 47.13 Tcf.  

“Offshore discoveries will be commercialized via LNG projects, and the majority will be for export,” Mwose explains, complementing the notion with the fact that Tanzania “doesn’t have the capacity to consume so much”.  

Tanzania has yet to discover crude oil, commercially, but possesses areas on the surface geologically similar to oil-proven zones, such as Uganda’s Albertine Graben and Kenya’s Turkana Basin.  

“We have a good chance of discovering oil along the Eyasi-Wembere Basin,” he adds, an onshore waterway situated East of Lake Tanganyika, the world’s longest and second-deepest freshwater lake—nestled between the Democratic Republic of Congo and Tanzania—where more lucrative reserves are being touted.  

It is in Lake Tanganyika that the government is currently in the process of pre-exploration, demarcating oil and gas blocks to auction off to bidders in what will be its fifth licensing round.  

Speaking on the differences between oil and gas distribution, the petroleum engineer assures that “once you discover oil, the market’s there…For gas, there’s a complexity in terms of processing, but it’s easier to transport it…the contracts have to be long-term to justify the investment.” 

Economies thrive when energy is abundant. Cheap power provides greater fiscal room for local businesses to succeed and is one of the key offerings that attracts large-scale industrialization. From a societal perspective, less money spent on electricity means household spending power rises, as well as the ability to save.   

Mwose mentions midstream ambitions from the government to establish a refinery in Tanga, a port city that will soon anchor the 1,447-kilometer East African Crude Oil Pipeline (ECOP) project, sending Ugandan oil into the open market, and perhaps, in the future, Tanzanian oil, too.