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  • on 23.05.2015
  • at 10:10 AM
  • by evelina

The oil giants are coming to Tanzania 0

International oil giants are bearing down on East Africa. Off the coast of Tanzania, the discovery of 46.5 trillion cubic feet of natural gas reserves has put the country on the world energy map. The number is expected to rise to 200 trillion cubic feet in the next two years, and eventually transform Tanzania into a middle-income country.

Companies like Exxon Mobil, BG Group and Norway´s Statoil are working with the Tanzanian Petroleum Development Corp (TPDC) in exploration, building infrastructure and construction. However, the real issue is the profit-sharing contracts currently being negotiated between the big oil companies and the government.

The Production-Sharing Agreements (PSA) between the international firms and the TPDC are confidential. However, the draft of a contract with Statoil has leaked . Instead of the expected 50-75%, Tanzania would only be getting 30-50% of the “profit gas.” Unfortunately, the government has little to no leverage but everyone knows the country needs the investment big oil could bring.

With elections coming up this year, the oil and gas question is a hot topic. For a politician trying to gain traction it is heaven-sent. From independence until his retirement in 1985 the country was lead by the great Julius Nyrere, whose ideology was socialist and has been called communist. The communitary mindset lead to many great things and is still tangible in political discourses. However, it also lends itself to misuse.

The pre-election debate on the natural gas question for instance is full of flaming protectionist rhetoric. Here-comes-the-imperialist-west-again-we-must-protect-our-interests-so-vote-for-me-ism seems popular, especially with ruling party CCM. It simplifies things nicely, takes the attention away from failing schools and hospitals and reminds everybody that the problem is, really, external.

Continue reading on: Africa is a Country

by Marta Tveit

Photo Credit: Facebook

 

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