DAR ES SALAAM, Feb. 22 (Xinhua) -- A British energy firm has revealed a plan of injecting billions of U.S. dollars in Tanzania' s untapped huge gas reserves, local media reported on Wednesday.
The British Gas International (BGI) delegation led by its chairman Robert Wilson told Tanzanian President Jakaya Kikwete at the state House early this week that the multinational oil and gas giant has discovered huge reserves of natural gas in three wells including a deepwater one which were drilled in 2009 and last year in the Indian Ocean.
"We are planning to invest between 10 and 20 billion dollars in second half of this decade in gas and the Tanzanian economy," Wilson reportedly told his host Kikwete, noting that Tanzania has to prepare its economy to handle such an amount of money.
The company, which entered Tanzania in 2011 through a purchase of 60 percent of shares of Ophir Tanzania Limited, a licensed gas explorer, invested 500 million dollars in gas exploration in the country last year and it will invest the same amount this year.
The delegation accompanied by Diane Corner, the British High Commissioner to Tanzania, called on the government and BGI to join efforts to counter challenges in exploration and production of gas in the Indian Ocean especially in dealing with pirates originating from Somalia.
Kikwete assured the investors that the government will further tighten security in the area of exploration.
"I assure you that we will make sure that the Production Sharing Agreements benefit Tanzanians as well as investors," said Kikwete in a statement quoted by the Guardian.
Meanwhile, an Act for regulating the gas sector is being enacted following an appeal by the opposition to the president to stop signing gas exploration contracts until a gas policy is issued.
Energy and Minerals Minister William Ngeleja was quoted as saying that the efforts are undertaken to finalize the draft bill which would spell out regulations for the government's firm control of the industry.
The opposition's appeal came a day after it had transpired that the government and an Australia-based company, Swala Energy, had signed an oil and gas exploration contract, whose entry brings to 26, the number of fuel exploration licenses issued by Tanzania, the highest in the Eastern African region.
Following commercial gas discoveries in Songosongo and Mnazi Bay in the Ruvuma basin in the south of the country, foreign companies have been attracted to invest massively in exploration activities.
About 3.5 trillion cubic feet of gas reserves have already been commercialized, of which some of the gas is transported to Dar es Salaam through a pipeline, and is used to generate electricity and as fuel in factories.
Experts estimate that Tanzania will confirm around 60 trillion cubic feet of natural gas in the next five years, which would bring in another wave of investment into the country.