In East Africa, a presentation to parliament by George Simbachawene, Tanzania’s energy and minerals minister stated that the country’s current natural gas reserves are estimated to be approximately 55 trillion cubic feet (tcf) following new deep sea discoveries off its southern coast.
The government had raised the natural gas resources estimate by 18% following the discoveries by Statoil, Exxon Mobil, BG Group and Ophir Energy, Reuters reported.
Natural gas estimates
East Africa is a new hotspot in hydrocarbon exploration after substantial deposits of crude oil were found in Uganda and major gas reserves discovered in Tanzania and Mozambique.
Simbachawene explained that: “As a result of ongoing exploration activity, natural gas resources discovered in the country rose from 46.5 tcf in June 2014 to 55.08 tcf in April 2015, equivalent to an increase of 18%.”
Further to this, a pipeline connecting offshore natural gas fields to Tanzania’s commercial capital Dar es Salaam would be commissioned in September, reported Reuters.
Distribution pipeline targeted
The 532km pipeline and gas processing plants, financed by a $1.225 billion (ZAR15 billion) Chinese loan were initially expected to be completed last year, but were delayed due to technical setbacks as a result of pre-commissioning inspection tests on the pipeline.
“The commercial operational date of [the] gas processing plants and the pipeline has now been set at September 2015”, stated the Minister.
The pipeline has enable the country to switch to gas-fired power plants and reduce oil imports that could lead to an annual saving of over $1 billion (ZAR12 billion).
Electricity supply and grid stability
Simbachawene said the government would invest in new gas-fired power plants to boost electricity supply in East Africa’s second-biggest economy, which has experienced frequent chronic energy shortages.
“During 2015/16 the government will start implementing the construction of a 240MW [gas] power plant that is expected to cost $344 million (ZAR4 billion)”, he said.
The minister added that the government would also start work in 2015/16 on the construction of 1,148 km of a new 400 kV power line at a cost of $664 million (ZAR8 billion) in the north-west power grid.
“Another project involving the construction of a power transmission line in the north-east grid will be financed by a $693 million (ZAR8.5 billion) loan from China’s Exim Bank”, concluded Simbachawene.