Tanzania to Review Oil, Gas Contracts

Tanzania’s Energy and Minerals minister Sospeter Muhongo has ordered the new board of the Tanzania Petroleum Development Corporation (TPDC) to review all 26 production-sharing agreements with oil and gas companies.

The move comes as a result of mounting concerns some firms are exaggerating the costs to reap more profits during production, The Citizen newspaper said in a report. As a result there is a feeling in the government that the country is getting a raw deal. 

The east African nation is estimated to hold natural gas reserves of 43 trillion cubic feet worth $430 billion and more discoveries are expected. The discoveries have prompted the government to initiate the review of its oil and gas exploration legislation as well as draw up strategies and tax regime to enable the country benefit from the boom, the newspaper said.

Recently the government delayed a licensing round for up to nine deep-sea oil and gas blocks until an appropriate legislation is enacted. The fourth licensing round was scheduled to be launched in Houston, Texas last Friday.