Tanzania hopes to conclude a deal for a liquefied natural gas project within six months after the country’s president called for the resumption of negotiations that had stalled for more than a year.
Talks for the host government agreement, or HGA, which will govern the fiscal, legal and commercial terms for the proposed two-train onshore LNG project collapsed in 2019. Plans for a plant on Tanzania’s southern coast connected to offshore fields by pipeline have been under proposal since 2014.
“The government’s negotiating team has already been formed ahead of the resumption of talks and we will prepare from next week to restart negotiations with investors as soon as possible,” said James Mataragio, managing director of Tanzania Petroleum Development Corp.
Investor sentiment toward Tanzania was resentful after the administration of former president John Magufuli reviewed mining legislation and ordered a new renegotiation of contracts. His successor, Samia Suluhu Hassan, told lawmakers last week that talks on the LNG plant had dragged on too long and pledged to end them quickly so the project could be implemented.
One of the developers, Equinor ASA, took a $982 million deficiency in the project in January, which it said would be reversible after failing to reach agreement with the Tanzanian government. Other project partners include Royal Dutch Shell Plc, Exxon Mobil Corp, Ophir Energy Ltd. and Pavilion Energy Pte.
