The government saved USD3.5bn between 2004 and December last year by using natural gas instead of liquid fuel to generate electricity for the national grid.
Making the revelation at a training of trainers’ court in Dar es Salaam yesterday, Tanzania Petroleum Development Corporation (TPDC) managing director Yona Killagane said so far 37 industries and institutions have been connected and are using locally produced natural gas in their operations.
Natural gas utilisation started July 1, 2004 immediately after the construction of the Songo Songo gas project under the finance of the World Bank.
Killagane said currently the project generates about 412 MW for the Tanzania Electric Supply Company (Tanesco) representing 45 percent of the total power supply.
The TPDC boss said the pilot project for the use of natural gas in vehicles was initiated in 2009.
“This was a successful project in stimulating gas usage for households and vehicles. Two private firms in association with some training institutions are involved in the conversion of vehicles for natural gas,” Killagane said.
Power generation is heavily constrained through the use of liquid fuel for lack of natural gas due to adequacy of infrastructure, he said.
But the government, he said, was working to set up new infrastructure to cope with the big demand for gas in Dar es Salaam.
“The setting up of new infrastructure will include one on power generation, for industries, for domestic and institutional use and for vehicles,” Killagane said.
Currently there are five rigs operating in the country, he said, adding that two of them are operating in deep waters and three onshore, at Songo Songo and Mtwara.
“The recent gas discovering in the deep waters clearly points to a direction that Tanzania will take in future a major exporter of gas as Liquefied Natural Gas (LNG),” he noted.
Speaking of TPDC, Killagane said it has started constructing 4.28bn/- a gas pipeline from Ubungo to Mikocheni Industrial Estate since last year adding that the project will come to completion by end of next month.
“This means the project will be a cheaper means of transportation instead trucks, which are currently being used,” he said.
Speaking after awarding certificate to the trainees, Permanent Secretary in the Ministry of Energy and Minerals Eliakim Maswi said the demand for natural gas has been growing year after year.
The government is in final stages of preparing a natural gas policy, Act and utilisation master plan which will be designed to address growth in the domestic and export gas in order to ensure proper utilisation of the commodity, he said.
“Some of the issues to be addressed are natural gas supply chain, gas pricing, gas infrastructure development and long term gas supply security,” the acting PS said.
Maswi said following the research that the government had done in various countries that produce gas, all main natural gas infrastructure are normally public owned and government vehicles and public transport use natural gas.
“This will be implemented in our country and to start with, the government has appointed a committee to develop natural gas transmission infrastructure that will connect all resources to the market and Dar es Salaam main project,” he said.
He stressed that the project involves laying pipeline along the main roads of Dar es Salaam and Construction of vehicles refueling stations.