Business News Analysis BY LEO ODERA OMOLO
Kenya will be the first destination for Tanzania natural gas, according to a report appearing in the influential Nairobi publication the EAST AFRICAN.
It says a company called Artumas Group Incorporation, a Mtwara-based gas exploring company has been given the go ahead by the Tanzanian government to export its products to Kenya.
It quoted a source in the Tanzanian Ministry of Energy and Mineral as saying that gas exports to Kenya will depend on whether they can satisfy local demands.
The plant at Mtwara has a capacity fro 300MW and the company recently finalized plans for motor vehicles and domestic purposes.
It further quoted the CEO of the firm Stephen W.Mason as saying that he was not in a position to comment on the company gas export plans to Kenya.
The Norwegian –listed oil and gas firm discovered a gas deposit at Mnazi Bay in Mtwara region, which has about two trillion cubic feet of proven gas deposit.
Early last year, the Tanzania government effectively licensed the Norwegian Company which is involved in the exploration of gas to generate electricity to be supplied to Lindi and Mtwara, two of the county’s underdeveloped regions.
According to a prèss statement recently released by the company, the Tanzania government has given approval to the firm to finalize negotiations with the relevant parties for the export of compressed natural gas to off-take clients in Mombasa, Kenya.
It further stated that the approval allows Artumas to move forward to conclude the relevant projects Agreements including long term gas sales agreement with the off-take customers and transportation services agreement with the compressed natural gas shipper.
In the statement Mr. Mason said the conclusion of these commercial agreements of these would underpin the current planning activity in support of commencements of the drilling programmes in fourth quarter of 2008
The CEO said, “During the past year, Artumas has worked in close cooperation and collaboration with its working interest partner, Tanzania Petroleum Development Corporation and the government of Tanzania to determine the optimal use of the large gas resource base located in the Tanzania port of Ruvuma Basin.
The commercialization strategy involves balancing Tanzania’s domestic requirements with high-value export opportunities. The approval fro export compressed natural gas reflects the vision of the government of Tanzania and is further evidence of the confidence held by the government in the abilities of Artumas to execute on its recommendations.
The gas exploration at Mnazi Bay became the second facility to produce electricity from locally sourced gas. The first was gas from Songo Songo Island, which is transported to Dar Es Salaam via a pipeline to Ubungo power plant from where Songa generate power fro sale to Tanesco
Tanzania has also discovered further gas deposits at Mteranga slightly over 40km from Dar Es Salaam.
The director general of the Energy and Water Utilities Regulatory Authority Harun Masebu last year said that the Mnazi Bay gas to electricity project will generate power that is sufficient for small and medium industries in the Lindi-Mtwara region.
Ends
leooderaomolo@yahoo.com
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Date: Tue, 16 Sep 2008 06:26:46 -0700 (PDT)
From: Leo Odera Omolo
Subject: PLANS ARE ON FOR TANZANIA TO EXPORT NATURAL GAS TO KENYA