EARTH RESOURCES OF TANZANIA: AN

ENGINE FOR POVERTY ERADICATION

AND ECONOMIC PROSPERITY FOR ALL

Sospeter Muhongo Minister of Energy and Minerals

United Republic of Tanzania

s.muhongo@bol.co.tz sospeter.muhongo@mem.go.tz

profmuhongo.sospeter@gmail.com

Dar Es Salaam, TANZANIA Sunday, 08 December 2013

AN INDEPENDENCE DAY UDASA DIALOGUE

WHAT IS A UNIVERSITY?

Benjamin Disraeli (1804-1881)

British Tory statesman and novelist

Prime Minister :1868, 1874-1880

“A university should be a place of light, of liberty and

of learning.”

2

AFRICA: ~20 % OF THE WORLD'S LAND AREA

~14 % OF WORLD’S POPULATION ~ 2 % OF THE WORLD’S GDP

WHAT IS SCIENCE?

Bertolt Bretcht (1898-1956)

German Dramatist, 1939 – Life of Galileo

“The aim of science is not to open the door to infinite

wisdom but to set a limit to infinite error.”

4

21ST CENTURY ECONOMIC PROSPERITY =

KNOWLEDGE +TECHNOLOGY + INNOVATION +

HUMAN CAPITAL + FINANCIAL CAPITAL

OECD + BRICS > 80% of World’s GDP

THE LARGEST ECONOMIES OF THE WORLD IN 2050

UKUBWA WA ENEO LA UTAFUTAJI NA

UCHIMBAJI WA MADINI (TANZANIA BARA)

UKUBWA WA ENEO LA NCHI KAVU (TANZANIA BARA)

= 881.000 SQ.KM.

UKUBWA WA ENEO LINALOWEZA KUTOLEWA LESENI ZA KUTAFUTA NA KUCHIMBA MADINI

=239,699 SQ.KM.

7

TOP 10 LOCAL COMPANIES

1.Mr Alhussein Juma Dhanani (19 companies)

♦Size of the licensed area: 25, 589.02 sq. km.

♦% of area under licenses (out of 239,699 sq.km): 10.7%

♦% of total land area (out of 881,000 sq.km): 2.9%

2. Mr. Hassan Ahmed Abdulbari (10 companies)

♦Size of the licensed area: 14,238.84 sq. km.

♦% of area under licenses (out of 239,699 sq.km): 5.9%

♦% of total land area (out of 881,000 sq.km): 1.6%

8

CONTINUE –TOP 10

3.Mr Reginald Mengi (5 companies)

♦Size of the licensed area: 3,836.18 sq. km.

♦% of area under licenses (out of 239,699 sq.km): 1.6%

♦% of total land area (out of 881,000 sq.km): 0.4%

4. Mr. Connie Mashele (1 company)

♦Size of the licensed area: 2,426.54 sq. km.

♦% of area under licenses (out of 239,699 sq.km): 1.0%

♦% of total land area (out of 881,000 sq.km): 0.3%

9

CONTINUE –TOP 10

5.Mr David T Kalenuik (2 companies)

♦Size of the licensed area: 2,283.21 sq. km.

♦% of area under licenses (out of 239,699 sq.km): 1.0%

♦% of total land area (out of 881,000 sq.km): 0.3%

6. Mr. Tito John Kanyamala (1 company)

♦Size of the licensed area: 1,794.9 sq. km.

♦% of area under licenses (out of 239,699 sq.km):0.7%

♦% of total land area (out of 881,000 sq.km): 0.2%

10

CONTINUE –TOP 10

7.Mr Elias Rwezaula Bulaya (1 company)

♦Size of the licensed area: 1,646.91 sq. km.

♦% of area under licenses (out of 239,699 sq.km): 0.7%

♦% of total land area (out of 881,000 sq.km): 0.2%

8. NDC (2 licenses)

♦Size of the licensed area: 855.5 sq. km.

♦% of area under licenses (out of 239,699 sq.km): 0.4%

♦% of total land area (out of 881,000 sq.km): 0.1%

11

CONTINUE –TOP 10

9.Mr Alka Chavda (1 company)

♦Size of the licensed area: 780.23 sq. km.

♦% of area under licenses (out of 239,699 sq.km): 0.3%

♦% of total land area (out of 881,000 sq.km): 0.1%

10. Mr. Alhaji Said R Kilahama (3 companies)

♦Size of the licensed area: 592.92 sq. km.

♦% of area under licenses (out of 239,699 sq.km): 0.2%

♦% of total land area (out of 881,000 sq.km): 0.1%

12

MERELANI HAWALIPI KODI

JUMLA YA LESENI ZA UCHIMBAJI = 597

LESENI ZILIZOWAKILISHA RIPOTI =13

2007-2012 LESENI ZILIZOLIPA MRABAHA = 10

JUMLA YA MALIPO: Tshs. 32,019,175

2009-2012 WACHIMBAJI WADOGO MAARUFU: 13

WALIOLIPA KODI: 5, Tshs: 10, 413, 590

JUMLA YA LESENI ZA WACHIMBAJI WADOGO (TZ): 27,815 13

TOP 10 FOREIGN COMPANIES

Names of Directors/Representatives:

1. Mr K. Maseepha: 6,705 sq.km, 2.8%, 0.8%

2. Mr Nyelo: 5,790.51 sq.km., 2.4%, 0.7%

3. Mr S Lwakatare: 5,278.72 sq.km., 2.2%, 0.6%

4. Mr J Kahama:5,237.13 sq.km., 2.2%, 0.6%

5. Mr D Mwanyika: 3,256.79 sq.km., 1.4%, 0.4%

6. Mr D Spencer: 2, 252.04 sq.km., 0.9%, 0.3%

7. Mr I MacLiver: 2,231.06 sq.km., 0.9%, 0.3%

8. Mr J Ross: 2,110 sq.km., 0.9%, 0.2%

9. Mr P B Kehoe: 1,723 sq.km., 0.7%, 0.2%

10. Mr M Stanley: 1,448.17 sq.km., 0.6%, 0.2%

14

SUMMARY: TOTAL NO OF COMPANIES

NUMBER OF COMPANIES HOLDING LICENSES

1. LOCAL (PL, ML, SML): 743/1,067

70% OF TOTAL

2. FOREIGN (PL, ML, SML): 271/1,067

25% OF TOTAL

(>50% SOLD BY TANZANIANS)

3. JV (PL, ML, SML): 53/1,067

5% OF TOTAL

(100% TANZANIANS IN JVS) 15

WHAT DOES DESPAIR MEAN?

Graham Greene (1904-1991), an

English Novelist, In the Heart of the Matter, 1948:

“Despair is the price one pays for setting oneself an impossible aim.”

16

SEDIMENTARY BASINS

OF TANZANIA

. Inland Rift Basins and Modern Rift System: 114,000 sq km

Coastal and Continental Shelf Basins (onshore and offshore including the Islands of Zanzibar Pemba and Mafia : 280,000 sq km

Deep Sea Basins: Basins (300m to 3000m of water depths) 140,000 sq km

TOTAL: 534,000 sq km

MAKISIO YA AWALI YA UTAFUTAJI

NA UCHIMBAJI WA GESI/MAFUTA

1. TATHIMINI ZA KIJIOFIZIKIA NA KIJIOLOJIA :US$ 10 MILLION

2. UKUSANYAJI WA TAKWIMU ZA 2D &3D: US$ 5 MILLION

3. TATHMINI ZOTE ZA KIMAZINGIRA (EIAS): US$ 12 MILLION

4. UCHIMBAJI WA VISIMA 3 VYA UTAFITI (@ 170 MILL)

US$ 510 MILLION

5. UCHIMBAJI WA VISIMA 6 VYA TATHMINI (@ 150 MILL)

US$ 900 MILLION

6. UCHIMBAJI WA VISIMA 10 VYA UENDELEZAJI (@ 100 MILL)

US$ 1,000 MILLION

18

MAKISIO YA CHINI YA MIUNDOMBINU

MIUNDOMBINU YA KUSAFIRISHA GESI

KUTOKA BAHARINI HADI KWA

MTUMIAJI

└└►►US$ 15 BILLION

19

GHARAMA KWA MUOMBAJI WA VITALU

VYA BAHARINI

1.Gharama za kununulia kifurushi cha Lazima cha Zabuni za Vitalu vya Bahari Kuu (BRDP for Deep Offshore Blocks): US$750,000 per package

2.Gharama za kununulia kifurushi cha Lazima cha Taarifa za Mitetemo ya ‘Mandatory 2 D SPAN’

US$ 3.375 Million per package

3. Gharama za kununulia taarifa za Hiari za Mitetemo ya “Optional 2D SPAN”

US$ 750 per km

20

NATURAL GAS DISCOVERIES

Mkuranga 2007 (0.2 TCF)

Kiliwani 2008 (0.07 TCF)

Songo Songo 1974 (2.5 TCF)

MnaziBay 1982 (5 TCF)

Ntorya 2012 ( 0.178 TCF)

TOTAL GIIP ( September 2013): 43.1TCF

Deep Sea (2010-12): 35.1 TCF

Total onshore = 8 TCF

UTILIZATION OF NATURAL

GAS

Power generation: 3,000 MW

LNG

Smelting plants

Cement industries

Other industries

Household (Homes)

Motor vehicles

Fertilizer production

Methanol plants

Plastics industries

Other Petrochemical Industries

SCHEMATIC DIAGRAM OF THE PROPOSED NATURAL GAS

PROCESING PLANTS IN MTWARA AND SONGOSONGO AND

THE UNDERCONSTRUCTION PIPELINE TO

DAR ES SALAAM

LIQUEFIED NATURAL GAS (LNG) TAKES UP ABOUT 1/600TH THE VOLUME OF NATURAL GAS IN THE GASEOUS STATE

24

Natural Gas is condensed into a liquid at close to atmospheric pressure (maximum

transport pressure set at around 25 kPa (4 psi) by cooling it to approximately −162 °C

1 TRAIN: 1 MILLION TONS PER ANNUM – 150 mcft/day – 25 yrs = 4.8 tcf

POLICY AND LEGAL

FRAMEWORKS

Oil & Gas Upstream Legislations: • National Energy Policy 2003 • Petroleum (Exploration and Production) Act, 1980 • The Model Production Sharing Agreement, 2008

(MPSA) Oil & Gas Downstream Legislations:

• Petroleum Act, 2008 • Electricity Act, 2008 • Natural Gas Policy, 2013. • Natural Gas Act (in the making) • National Gas Utilization Master Plan (in the making)

Crosscutting Legislations

• The Environmental Management Act, 2004 • Income Tax Act, 2004 • Occupational Safety and Health Act, 2003 • Public-Private-Partnership Act, 2010

GLOBAL RESERVES OF NATURAL GAS

PROVED BY END OF 2012: 187.3 TRILLION CU.M. └└►►►MEET 55.7 YRS OF GLOBAL PRODUCTION

GLOBAL DEMAND OF LNG

2012: 240 mmtpa

2025: 440 mmtpa

└└►►►2020 ASIA will account for 60% of the World’s Demand

TANZANIA’S UNIQUE GEOGRAPHIC LOCATION: ASIA & EUROPE

SHALE GAS - ca. 920 Trillion cu.m. of unconventional gas around the

World for future energy supplies 26

GLOBAL RESERVES OF OIL

1. VENEZUELA: 20%

2. SAUDI ARABIA: 18%

3. CANADA: 13%

4. IRAN: 9%

GLOBAL DEMAND OF OIL:FORECAST

2013: 90.9 million b/d

2014: 92 million b/d

└└►►►GLOBAL GDP GROWTH: 2013 – 3.1%

2014 – 3.8%

27

HUMAN CAPITAL - MARSHALL PLAN

VETA MTWARA:

2010 (PETROBRAS): 50 Students + 2 Trainers

2012 (BG): 300 Students (2 Year-Training Programmes)

2012/2013 (MEM): 50 Students (short courses)

VETA LINDI:

2014 (BG): 240 Students (2 Year-Training Programmes)

DIT/VETA/BICCO: (20) - Training of Trainers for Gas

Infrastructure

28

HUMAN CAPITAL - MARSHALL PLAN

MADINI INSTITUTE, DODOMA

3-year Diploma Programme in Petroleum Engineering/Geoscience

Year II: 54 Students, Year I: 56 Students

UNIVERSITY OF DODOMA

4-year Degree Programme in Petroleum Engineering

Yr IV+III+II: 74 Students, Yr I: 38 Students

UNIVERSITY OF DAR-ES-SALAAM

4-year degree programmes on: BSc Petr. Chem: 22 Students

BSc Petr Eng: 22 Students

BSc Petr Geol: 15 Students

OVERSEAS STUDENTS (FAMILY SCHOLARSHIPS)

BSc Petroleum Engineering: 51 Students

– India, China, Ukraine and UK

29

HUMAN CAPITAL - MARSHALL PLAN

POSTGRADUATE PROGRAMMES 1. Norway: Trondheim (STATOIL): 2012-17: 40 MSc

2. Norway: 4 MSc

3. China: 10 MSc

4. Brazil: 10 MSc

5.UK: 8 MSc

TPDC CURRENT STAFF

1.PhD = 4

2. MSc/MA/MBA: 36

3. BSc: 62

4. Diploma: 6 (technicians)

5. NEW RECRUITMENT (2013): 41 vacancies (BSc & Above)

10 vacancies DIPLO TECH

30

POVERTY

DEVELOPMENT VISION 2025

George Bernard Shaw (1856-1950), Irish Dramatist, 1907:

“The greatest of evils and the worst of crimes is poverty”

Plato (429-347BC ), Greek Author & Philosopher in Athens,

“We can easily forgive a child who is afraid of the dark; the real tragedy of life is when men are

afraid of the light.” VISION 2025: MIDDLE INCOME COUNTRY

US$12,616 or more: High Income

US$4,086 - 12,615: Upper Middle Income

US$1,036 - 4,085: Lower Middle Income

US$1,035 or less: Low Income

31

WHO IS A LEADER?

On 14 April 1945 in The Herald Tribune, American Journalist, Lippman Walter (1889-1974)

“The final test of a leader is that he leaves behind him in other

men the conviction and the will to carry on.”

Do we have the conviction and the will?

Mwalimu Julius Kambarage Nyerere

32

DEVELOPMENT VISION 2025

“TUMEAMUA KUJENGA TAIFA LENYE UCHUMI IMARA. UCHUMI UNAOTOA AJIRA NA MAISHA

BORA YENYE MATUMAINI KWA VIJANA, MASKINI NA WANYONGE. “

“TUMEAMUA KUJENGA UCHUMI UNAONUFAISHA WATANZANIA WOTE.”

“TUMEAMUA KUJENGA TAIFA LINALOJIAMINI NA KUAMINIKA”

NAWASHUKURU SANA KWA MWALIKO WENU

(SOSPETER MUHONGO, 08 DESEMBA 2013) 33