State launches team of negotiators for gas deals

Analysts say the acquisition is the most significant response yet to the slump in oil prices and could set in motion a series of mergers as the largest energy companies look to cut costs and restore profits.  

By The Citizen Reporter &Agencies

By The Citizen Reporter

In Summary

• The team consists of 25 experts from different backgrounds to ensure that all issues for building a sustainable oil and gas economy are addressed

Zanzibar. The Union Government yesterday launched a team of negotiators in all natural gas and oil contracts with international oil companies (IOCs) so as to tap the best deals for the socioeconomic benefit of Tanzania and its people.

The team consists of 25 experts from different backgrounds to ensure that all the relevant issues for building a sustainable oil and gas economy are addressed. The institutions they come from include the ministries of Energy and Minerals, Finance, Labour as well as Industry and Trade.  Others are the Attorney General’s Chambers, Tanzania Electric Supply Company, Tanzania Petroleum Development Corporation, Planning Commission, State Mining Corporation, Prime Minister’s Office, Bank of Tanzania, revenue collection authority, University of Dar es Salaam, Ministry of Regional Administration and Local Government and the National Environment Management Council.

Officiating at a six-month capacity-building programme for  team members here, Chief Secretary Ombeni Sefue said: “It is my hope that this programme will help to equip participants with the requisite skills and tact to be good negotiators for the benefit of our nation, not only now but for generations to come.”

The event was organised by the Institute of African Leadership for Sustainable Development (Uongozi Institute).

He told the team “to dedicate itself to learning, understanding, strategically thinking, managing, researching, exploring and more importantly, negotiating well on behalf of us all; for Tanzania’s best interests now and in the future”.

He cautioned it that “negotiating oil and natural gas agreements with IOCs is a challenge which governments of natural resource-rich countries from Africa must address. The IOCs can afford to bring with them the best technical, fiscal and legal capacities in the world, backed by wide and lengthy experiences in the field. So the first challenge we face is one of negotiating power asymmetry between the highly under-sourced African governments and the highly resourced IOCs.”

Fifty trillion cubic feet of natural gas reserves have been discovered in Tanzania. He said these could provide impetus to transform the country to a middle income economy in the near future.