Tanzania signs 4 petroleum exploration licences after 223 billion cubic feet gas discovery

Tanzania has signed four petroleum exploration licences for the state-owned Tanzania Petroleum Development Corporation (TPDC), stepping up efforts to expand natural gas production and strengthen domestic energy security following a major gas discovery in the Mtwara Region.

Vice President Deogratius Ndejembi witnessed the signing of the licences covering Eyasi-Wembere, Lindi-Mtwara, West Songo Songo and Mnazi Bay North, a day after the government announced an estimated 223 billion cubic feet of natural gas at the Kasa-1X ST2 exploration well in Mnazi Bay.

The discovery, announced on October 27, was made by TPDC in partnership with French energy company Maurel & Prom. The operator reported a preliminary estimate of approximately 200 billion cubic feet, subject to further technical evaluation.

The four licences are expected to expand TPDC's role in petroleum exploration, strengthen local technical capacity and increase Tanzania's participation in the development of its natural resources.

Energy Minister Juma Zuberi Homera said the licensing programme demonstrated the government's commitment to increasing national participation in the petroleum sector and ensuring that the country derives greater economic benefits from its resources.

The latest discovery adds to Tanzania's estimated 57.54 trillion cubic feet of natural gas resources, comprising 47.13 trillion cubic feet offshore and 10.41 trillion cubic feet onshore.

Homera said the Kasa-1X ST2 well was expected to produce approximately 30 million cubic feet of natural gas daily for at least 10 years, depending on development and operational requirements.

Production at Mnazi Bay has also increased following the development of two additional wells, MB-5 and MS-2, which were reported to have added more than 65 million cubic feet of gas per day.

Maurel & Prom said output from the Mnazi Bay field had reached approximately 130 million cubic feet daily in October, supporting supplies for electricity generation and other domestic consumers.

More than 80 per cent of the gas produced at Mnazi Bay is used to generate electricity through Tanzania Electric Supply Company facilities in Mtwara and Dar es Salaam, according to the Energy Minister.

The government is also expanding infrastructure to bring additional gas supplies to consumers. Construction of a 35-kilometre pipeline connecting the Ntorya gas field to the Madimba processing facility had reached 74 per cent completion, according to government figures.

The pipeline is expected to facilitate the delivery of additional gas for electricity generation, industrial use and other domestic needs.

Tanzania is also seeking to expand natural gas consumption beyond power generation. By September 2026, the country had established 22 compressed natural gas filling stations and 20 vehicle conversion workshops. Six industries, 21 institutions and approximately 5,000 households were also connected to natural gas distribution infrastructure.

TPDC is holding discussions with four prospective investors interested in developing small-scale liquefied natural gas projects, three of which are proposed for Mtwara Region.

The expansion of exploration and production activities has also created opportunities for local businesses and workers. Homera said approximately 200 Tanzanians had secured employment through companies involved in the Mnazi Bay drilling programme, while 35 contracts worth more than TZS 20 billion had been awarded to locally owned businesses.

TPDC increased its participating interest in the Mnazi Bay venture from 20 per cent to 40 per cent in 2024, with Maurel & Prom retaining a 60 per cent stake. The increased government participation is expected to strengthen TPDC's involvement in project decisions and potential earnings from production.

The Petroleum Upstream Regulatory Authority welcomed the licensing programme, saying it would continue overseeing exploration activities in line with petroleum legislation, environmental requirements and licence conditions.

The authority also emphasised the need to increase the participation of Tanzanian professionals and companies in the petroleum industry.

The licensing agreements and latest gas discovery form part of Tanzania's broader strategy to expand energy infrastructure, support industrial development and create employment opportunities under its Development Vision 2050.

However, the pace of future production and investment will depend on further exploration results, commercial viability, financing and the infrastructure required to deliver natural gas to domestic and regional markets.