Gas Mtwara

 

Elias Msuya 

Natural resource is a naturally occurring hydrocarbon gas mixture consisting primarily of methane, but commonly includes varying amounts of other higher alkanes and even a lesser percentage of carbon dioxide, nitrogen, and hydrogen sulfide. It is an energy source often used for heating, cooking, and electricity generation. It is also used as fuel for vehicles and as a chemical feedstock in the manufacture of plastics and other commercially important organic chemicals. 

It is found in deep underground rock formations or associated with other hydrocarbon reservoirs in coal beds and as methane clathrates. Petroleum is also another resource found in proximity to and with natural gas. Most natural gas was created over time by two mechanisms: biogenic and thermogenic. Biogenic gas is created by methanogenic organisms in marshes, bogs, landfills, and shallow sediments. 

Deeper in the earth, at greater temperature and pressure, thermogenic gas is created from buried organic material. Before natural gas can be used as a fuel, it must undergo processing to remove impurities, including water, to meet the specifications of marketable natural gas. The by-products of processing include ethane, propane, butanes, pentanes, and higher molecular weight hydrocarbons, hydrogen sulfide (which may be converted into pure sulfur), carbon dioxide, water vapor, and sometimes helium and nitrogen. 

Natural gas is often informally referred to simply as gas, especially when compared to other energy sources such as oil or coal. However, it is not to be confused with gasoline, especially in North America, where the term gasoline is often shortened in colloquial usage to gas. 

Will Tanzania benefit? 

Tanzania is rich in natural gas having the total of 15 trillion cubic feet of proven natural gas reserves, equivalent to approximately US$150 billion at current prices, or 6 times Tanzania's current GDP. 

However, larger investments than the country’s current GDP of US$22 billion and new technologies are necessary, while benefits will typically spread over 25 to 30 years. It is expected that, Tanzania would get around 40% of total revenues depending on the tax regime and the share production agreement. 

Which means, around 7% of its projected GDP or about 1/3 of its current fiscal revenues if all above reserves can be exploited. These fiscal resources, while considerable, will not be sufficient to transform Tanzania.

The Tanzanian gas invenstment is controlled by The Tanzania Petroleum Development Corporation (TPDC) which is the State corporation through which the Ministry of Energy and Minerals implements its petroleum exploration anddevelopment policies. 

TPDC is responsible for exploration, production and technical services, finance and administration, managing diractor and marketing and investiment. It was established under the Public Corporations Act No.17 through the Government NoticeNo.140 of 30th May 1969. The Corporation began operations in 1973. 

For the time being, gas investment is done while its policy is on process. Foreign investment According to TPDC several foreign companies from are exploring for natural gas in Tanzania and especially Mtwara region where the gas pipeline to Dar es Salaam is under construction. 

The companies are Pan African Energy which has invested in Songosongo gas pipeline, Maurel & Prom which has invested in Mnazi Bay Gas Development Bigwa - Mafia Channel, Ndovu/Aminex which has invested in Nyuni - East Songo Songo Ruvuma, Petrodel which is at Latham – Kimbiji, Afren plc which is at Tanga, BG International, Statoill at deep sea Block-2, Petrobras at deep sea Block 5,6,8. 

Others are Dominion at deep sea block -7, Ophir East Africa Ventures Limited at Pande East, Beach Petroleum at Lake Tanganyika South, Dodsal at Ruvu, Heritage Rukwa (TZ) Ltd at Lake Rukwa Basin Kyela Basin, Swala Energy at Kilosa-Kilombero Basin Pangani Basin, Motherland Homes at Malagarasi Basin, Open Acreage at Kisangire – Lukurilo, Mandawa, Selous and West Songo Songo. 

The Mtwara saga 

Since the end of last year, there have been riots in Mtwara region in which people claimed to be isolated in gas investment. The issue started by demonstrations which were organized by several political parties and civil societies. Through it the Mtwara people opposed the pipeline project to Dar es Salaam. 

After that, the government intervene by using the police force to supress their opposition. Apart from the forces, the Prime Minister, Mizengo Pinda and other ministers, visited Mtwara so as to calm the people and to emphacise the good will of the government to them. By doing so, the situation get cooled for a while. 

However, in May during the budget session in Dodoma, the riots errupted again when the minister for Energy and Minerals, Professor Sospeter Muhongo insisted that the project must be done. In this time, the government used the police force and the People’s defence force to supress opposition. Some people died and other were injured during the fight. Many houses were burnt and destructed. 

To make the matter understandable to people, the Prime Minister, Mizengo Pinda visited for the second time so as to find the solution. He also innaugurated the cement factory owned by Aliko Dangote, the Nigerian investor as the fruits of gas investment in Mtwara. 

Despite intervention of the government by force and diplomacy, still Mtwara People are not satsfactory with the whole process, saying that they will not benefit. In fact they need the whole process to be done in Mtwara, something which would make the region to be industrialised and hence developed. But the government insist that, the Mtwara gas is for the whole nation and it will be transported to Dar es Salaam for electrical generation. 

The government arrogance 

Speaking recently at the gas stakeholders conference in Dar es Salaam, the minister for Energy and Minerals Professor Sospeter Muhongo says the government is in control of the situation to benefit from oil and gas resources. 

“Know where we are going and we need our country to adopt gas economy. That’s why we started with Songosongo project and now the Mtwara one,” says Professor Muhongo. “In order the country to develop, first it might support science and technology. India, China and Malaysia have passed across,” he adds. 

Citing examples of Brazil and South Africa which have produce a large number of graduates from the field of oil and gas; he says that the government has also sponsored more students in the same field to increase skilled personnel. 

On the other hand he challenged the Tanzania Private Sector foundation that, it is not matured enough to invest in oil and gas. “Let me just be frank on this, no Tanzanian company is capable to invest in gas especially in deep sea. You first need to go 80 kilometer beyond the sea and you dig deeper three kilometer. You might end up with nothing…” 

“You can’t use a loan from commercial bank because it has no guarantee. Petrobrass which is a multinational company, has used USD175 million and loose the deal. What about our local companies?” However, he encourages the private sector to try minor projects rather than competing in big deals claiming on indigenous favoritism.