Kapuulya Musomba, Acting Managing Director, Tanzania Petroleum Development Corporation (TPDC): Interview

Interview: Kapuulya Musomba, Acting Managing Director, Tanzania Petroleum Development Corporation (TPDC)

What is the potential of gas-to-power (GTP) and the Mtwara-Dar es Salaam Natural Gas Pipeline?

KAPUULYA MUSOMBA: The pipeline was constructed from Mtwara with its terminal point in Dar es Salaam. The primary objective of the pipeline was to build capacity for Tanzania’s GTP projects in response to demonstrated demand, and as part of the National Gas Utilisation Master Plan. Energy diversification and energy security were secondary objectives.

If you look at the potential contribution of GTP in the country’s overall energy scheme, it is estimated that it will contribute around 60%. This supply will benefit the country’s power grid in the long term, but the challenge now will be to implement the right permits and licences for dealers nationwide. GTP undoubtedly has a role to play, but a fine energy balance is also required. A comprehensive review of Tanzania’s energy environment will be carried out by the TPDC in December 2017 to not only plan for 2018, but also to address any areas of concern for operators, independent power producers (IPPs) and stakeholders, in both the public and private sectors.

There will be discussions on environmental assessments and feasibility studies, ultra-deepwater logistical challenges surrounding unexplored canyons, greenfield and brownfield development within the upstream sector, and more. Our role, above all, is to provide the gas for IPP projects with Tanzania Electric Supply Company – the organisation responsible for the generation, transmission and distribution of electricity – the state-owned Energy and Water Utilities Regulatory Authority, and other local entities.

What expansion plans are in the works for the gas distribution network?

MUSOMBA: There are four distribution areas, the first being the commercial centre of Dar es Salaam, where expansion of the network will take precedence over the other regions. Currently, a fuel feasibility study is being undertaken to plot out the next 12 months, so that energy can reach every occupied dwelling within the city limits. The study should only take two months, and upon completion there will be a tender process for the city’s distribution network to be expanded by the successful bidding company or consortium. Partnerships will be necessary in this project, in order to fulfil the requirement that at least 40% of employees are locals. The second distribution area is the coastal region, while the third region encompasses Mtwara and Lindi, along the south-east coast of Tanzania and the northern border of Mozambique.

Admittedly, private investors are highly sought after here, as the area remains a vital gateway into the country. One year ago a feasibility study was completed, and the government is anxious to see development in the region and at Mtwara Port in particular. The fourth area covers the capital Dodoma, Arusha, Mbeya, Mwanza and Tanga.

How will planned construction of the crude pipeline benefit Tanzania in the long term?

MUSOMBA: Construction on the 24-inch Uganda-Tanzania Crude Oil Pipeline will most likely begin before mid-2018 and should take three years to complete. Thousands of Tanzanians will directly benefit from employment opportunities created by the project, while foreigners and expatriates will be required to assist with construction in more technical and managerial roles. Making its way from Hoima, Uganda to the terminal point at the port in Tanga, Tanzania, accompanying infrastructure is required in the form of roads and railways. The $3.55bn project – which at 1443 km will be the world’s longest electrically heated crude pipeline – will also require security. The project will be key in delivering export earnings, providing direct and indirect employment opportunities for Tanzanians, attracting foreign direct investment inflows and satisfying power demand across the country.