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Tanzanian government completes talks with Shell and Equinor for a liquefaction terminal

The Tanzanian government has completed the negotiations for the construction of an LNG terminal jointly with Shell and Equinor. The contract papers are being prepared currently for the $30bill LNG terminal which will utilize the huge offshore gas reserves of Tanzania.

According to Tanzanian Ministry of Energy, government aims to close final investment decision (FID) by 2025. Tanzanian government is believed to be working on 10mil mt/year LNG liquefaction terminal.

One contract is being drafted for the Host Government Agreement, and another is for blocks 1, 2, and 4, which will provide natural gas for the LNG project, Tanzania’s Energy Minister January Makamba said.

Norwegian major Equinor has been exploring block 2, offshore Tanzania since 2011 and has made around nine discoveries so far, with total estimated gas in place of around 20 trillion cubic feet.

The current Russia-Ukraine crisis has created a huge opportunity for the existing and upcoming LNG suppliers across the world at least for the foreseeable future. Shell, the largest LNG trader in the world, is quite bullish about LNG demand and is exploring each and every possibility of meeting the demand emerging from Europe and Asia.