Recently, the two governments of Tanzania and Uganda made a signing of an agreement that will enable the execution of a feasibility study for the establishment of Tanzania- Uganda Gas Pipeline that is foreseen to link the gas fields located in both Uganda and Tanzania. Both of the countries have agreed to conduct the feasibility studies together in order to facilitate the pipeline project evaluation and also provide a guide to the feasibility of the gas pipeline project inclusive of the structure of the gas pipeline project, the requirements needed for the gas, the general size of the Tanzania- Uganda Gas Pipeline and any other information that will be deemed important about the pipeline project in order to facilitate good decision-making.
Recently, Tanzania made a discovery of a massive amount of natural gas of approximately 57.54trcf. However, as a result of the rise in demand of natural gas domestically and internationally, the government has set up plans to explore quite a number of locations namely: Songosongo West, Lake Tanganyika, Eyasi Wembere and the deep waters of the Indian Ocean in order to boost gas production.
Tanzania- Uganda Gas Pipeline Project Funding
It has been noted that Tanzania is searching for potential strategic partners to conduct the research and develop the oil sources and gas sources in partnership with the Tanzania Petroleum Development Corporation. The minister in charge of the ministry of energy in Uganda, Ruth Nankabirwa, made a plea to the financing institutions to give low-cost credit as they pursue to reducing lending to the fossil fuel projects in the country.
As for now Tanzania is awaiting the approval of $42 billion from the cabinet for the liquefied natural gas (LNG) project after winding up the negotiations with Equinor, Shell and Exxon Mobil in the month of May 2023. This Tanzania- Uganda Gas Pipeline project is expected to unlock a major natural gas capacity potential of over 36trcf.
