Tanzania is in discussions with investors over tax incentives for a stalled $42 billion liquefied natural gas (LNG) project, Energy Minister Doto Biteko announced on Tuesday. Speaking at the India Energy Week conference, Biteko expressed optimism that negotiations could be finalized by June.
The project, jointly operated by Equinor (EQNR.OL) and Shell (SHEL.L), also includes partners Exxon Mobil (XOM.N), Pavilion Energy, Medco Energi (MEDC.JK), and Tanzania’s national oil company TPDC. Progress had been hindered by proposed government revisions to a financial agreement reached in 2023.
“The project hasn’t stopped. We are negotiating terms to ensure viability for both parties,” Biteko told Reuters. He acknowledged that government incentives will be necessary, while the final production volume remains subject to ongoing talks.
“We can’t set a timeline until negotiations are complete, but I expect them to conclude within this financial year, between now and June,” he added.
The LNG project is set to unlock 47.13 trillion cubic feet of natural gas deposits, positioning Tanzania as a key energy player in the region.
Meanwhile, Tanzania is preparing to launch an exploration licensing round for 26 oil and gas blocks on March 5. Additionally, in collaboration with France’s TotalEnergies (TTEF.PA) and China’s CNOOC, Uganda and Tanzania are developing the 1,445-kilometer East African Crude Oil Pipeline (EACOP) to transport Ugandan crude to Tanzania’s Indian Ocean coast.
Biteko reported 47% completion of the pipeline, with an expected timeline of 36 months for full completion.