Shell, Equinor complete talks on Tanzania LNG project
Tanzania has concluded talks with Shell and Equinor pertaining to a $30bn LNG export project, the country’s energy ministry said on March 7 on Twitter.
The ministry announced that negotiations between the government and the two companies have been completed and the experts are now writing contracts. The first of the two contracts is for the holding government agreement (HGA) and the other is a combined contract for natural gas blocks 1, 2, and 4 whose gas will be used in the LNG project.
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The 7.5mn metric tons/year project is underpinned by trillions of cubic feet of gas off Tanzania's coast. It languished for years under the rule of former president John Magufuli, but his successor Samia Suluhu Hassan has said the project is a priority.
Equinor has been working in Tanzania since 2007 when it signed a production-sharing agreement to explore offshore Block 2, estimated to hold 20 trillion ft3 of in-place gas. ExxonMobil holds the remaining 35% interest in the project, but Equinor signed a memorandum with Shell in 2021 to collaborate in developing the liquefaction facility. Shell operates Block 1 and Block 4, with 16 trillion ft3 in estimated recoverable gas.