ZANZIBAR: PRESIDENT Hussein Mwinyi has invited prospective investors in the oil and natural gas sector, saying Zanzibar has put in place competitive, attractive and flexible legal and fiscal terms for investments to thrive.
“The government offers immense opportunities for investors in the oil and natural gas sector through creation of friendly environment that favours their operations,” Dr Mwinyi said here yesterday in a speech to launch the first licensing round in oil and gas exploration and extraction.
He said Zanzibar is already certified as one of the best and safe investment destination, assuring investors in all sectors of the government commitment to support and provide them with conducive business environment.
President Mwinyi said the government has reviewed all the legal and contractual framework in the oil and natural gas sector to attract investors for the social and economic development of the spice islands.
Shedding a brief history, Dr Mwinyi said oil and natural gas operations in Zanzibar started in the 1950’s when the British Petroleum and Shell company conducted joint exploration and drilling of two wells. The work ended in 1963, putting in place a strong foundation for oil/gas operations in the country.
But, after the 1964 revolutions and union between Tanganyika and Zanzibar, oil and gas operations became a Union matter under the Union government through Tanzania Petroleum Development Corporation (TPDC).
Oil and natural gas operations resumed in Zanzibar in 2015 after the union parliament had passed the Petroleum Act, No. 21 of 2015, allowing each side of the Union to handle their oil/gas matters.
“Oil and natural gas sector is today among the key priority areas of the government’s blue economy policy,” President Mwinyi said, maintaining that the government is determined to use reliable energy sources to build a strong economy for sustainable development.
He expressed optimism over the blue economy policy, saying “It has many opportunities to advance the economy, create jobs and reduce poverty.”
Blue Economy and Fisheries Minister Shaaban Ali Othman said Zanzibar has just passed the second-generation model production sharing agreement 2024 to attract foreign investors in the capital-intensive industry.
He said the country has eight oil and natural gas upstream blocks on offer for investors to conduct evaluation and invest in the Eastern side of Unguja and Pemba Islands.
The blocks’ water depths range between 500 and 3,000 metres while their sizes are between 2,800 and 5,600 square kilometres of highly prospective areas and attractive terms, the minister said, adding that the first licensing round is scheduled to last 10 months, effective yesterday.
Speaking at the launching ceremony, Vice-President of Offshore Atlantic East at Exploration Data with SLB, Nahed Kahloul described the launch as “momentous and historical milestone for the country.”
She said Zanzibar is geographically well positioned with good potential for exploration. Engineer Kahloul said despite an increasing push for renewable energy, demand for oil is still on the rise.
“Renewable energy is not likely to replace oil in the near future,” she said, cautioning however that governments have to be mindful on achieving the oil and gas demand as well as providing for “Our people in a responsible way.”
SLB is a global technology coy that works with governments to unlock exploration potential. The technological firm is the technical partner in Zanzibar’s first licensing round.
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