Tanzania closes in on $42 billion gas development project

Tanzania is hoping to lock down a $42 billion gas development deal that officials say will underpin the country's industrialisation.

The liquefied natural gas project — led by Equinor and Shell is expected to unlock 47.13 trillion cubic feet of natural gas ⁠reserves, Reuters reported, enough to place Tanzania among Africa's top six holders of gas reserves, behind Nigeria, Algeria, Senegal, Mozambique, and Egypt.

Talks to kickstart the project stalled in 2023 after Tanzanian authorities requested changes to a previously reached fiscal agreement.

The core disputes involved legal frameworks, dispute resolution mechanisms, and how revenue would be shared between the government and investors.

In September 2026, the Tanzania Petroleum Development Company (TPDC) chief announced that negotiations on commercial, fiscal, and revenue-sharing terms were largely complete.

If successful, the project, along with Uganda's crude flowing through the port of Tanga starting 2027, would make Tanzania and East Africa an energy hub.

In neighboring Kenya, work on a $17 billion refinery by Nigerian tycoon Aliko Dangote has started while further south in Mozambique, French energy giant TotalEnergies restarted construction of a $20bn liquefied natural gas plant in January.

The project, considered one of the largest LNG projects on the continent, was suspended in 2021 as violence escalated in the northern Cabo Delgado province.