The African Development Bank (AfDB) has approved a $29.8-million loan to Tanzania to help the country mobilise domestic resources and unlock the potential of its natural gas resources through leveraging domestic markets and local content initiatives.
The project will help Tanzania “capture the best value from its natural gas resources through a sound regulatory framework to manage natural gas reserves and to attract investment, as well as support the government negotiations teams to ensure the country gets the best deals and [that] local content policies [are designed] to create jobs in the gas sector,” the AfDB said in a statement.
The project will also contribute to designing strategies for domestication of natural gas, so that the gas resources can be used locally and regionally to develop the energy and industry sectors.
While the large offshore gas discoveries can be a game-changer for the country, doubling gross domestic product, developing access to energy at national and regional levels and facilitating industrial development, it also represents significant challenges.
“The AfDB is stepping up its support to the government of Tanzania to develop the gas sector that is potentially transformative for the country,” AfDB Tanzania country manager Chidozie Emenuga said.
Local content is a key priority for the country to ensure that the local private sector can benefit from large foreign investments, estimated at about $40-billion, to develop the liquefied natural gas production and export facilities.