DODOMA: Tanzania’s planned 42 billion US dollar liquefied natural gas (LNG) project remains on course, with negotiations between the government and international investors at an advanced stage, Prime Minister Mwigulu Nchemba has said.
Addressing lawmakers during Prime Minister’s Questions in Parliament, Dr Nchemba described the project as strategic but complex, underscoring the need for careful negotiations to safeguard national interests.
“Discussions are underway. Given the unprecedented scale of this investment, it is prudent for the government to proceed meticulously to ensure our national resources are properly protected,” he said.
The project, one of Africa’s largest planned energy investments, is expected to unlock an estimated 47.13 trillion cubic feet of natural gas and position Tanzania as a significant player in the global LNG market.
A key milestone — the Host Government Agreement (HGA) — is expected to be signed by mid-year, paving the way for a Final Investment Decision (FID). The project is being developed by a consortium led by Equinor and Shell, alongside ExxonMobil, Pavilion Energy, Medco Energi and the state-owned Tanzania Petroleum Development Corporation.
Located in Likong’o in the southern Lindi Region, the project is expected to produce up to 10 million tonnes of LNG annually once operational.
Dr Nchemba told Parliament that negotiations have evolved beyond the project’s initial export-focused framework, with the government now seeking to retain at least three per cent of extracted gas for domestic consumption to meet rising energy demand.
Another priority is ensuring meaningful participation by Tanzanian companies. The Prime Minister said President Samia Suluhu Hassan has directed that local firms be integrated into the project to strengthen the domestic economy and expand the national tax base.
“Empowering local companies is essential if we are to build a strong economy and broaden our revenue base,” he said.
Responding to concerns raised by Mtwara Rural MP Arif Premji over delays, Dr Nchemba said Tanzania has not previously undertaken a project of this scale, necessitating careful legal and policy preparation.
“This is a project of unprecedented magnitude for our country, and we must ensure that all frameworks are in place for Tanzania to fully benefit,” he said, adding that the government will continue updating Parliament on progress.
Beyond the LNG project, the Prime Minister highlighted youth empowerment as central to Tanzania’s long-term economic ambitions, including its goal of becoming a one trillion US dollar economy.
He said the government is implementing measures to support young entrepreneurs, including a 280 billion Tanzanian shilling guarantee scheme established by the Bank of Tanzania to improve access to finance.
Plans are also underway to establish a dedicated Guarantee Scheme Company to expand financing opportunities for youth-led businesses.
The government is targeting the creation of more than eight million jobs under the ruling Chama Cha Mapinduzi (CCM) 2025–2030 manifesto, as between 600,000 and one million young people enter the labour market each year.
Thenprogress on the LNG project, alongside youth-focused economic initiatives, could play a pivotal role in shaping Tanzania’s long-term growth trajectory and energy security.
