Tanzanian Prime Minister Dr. Mwigulu Nchemba has confirmed that Tanzania’s USD 42 billion Liquefied Natural Gas (LNG) project is progressing. Negotiations between the government & investors are at an advanced stage. The project aims to produce 10 million tonnes of LNG annually. It includes provisions for local gas consumption & also the participation of Tanzanian enterprises.
Dr. Mwigulu has also assured the National Assembly that the USD 42 billion Liquefied Natural Gas (LNG) megaproject is on track, adding that negotiations between the government & investors are presently at an advanced stage.
Responding to an impromptu question during the PM’s question & answer session in Parliament on Saturday, 9 April ’26, the Premier noted that while the project is strategic, several complex issues need to be resolved before its commencement.
Discussions are still underway, said Dr. Mwigulu, adding that given the unprecedented scale of the investment, it’s prudent for the government to be meticulous to ensure Tanzania’s national resources are properly safeguarded.
The Host Government Agreement (HGA) is expected to be signed during the middle of this year. It’s a critical milestone that may precede the Final Investment Decision (FID). This is jointly operated by Equinor & Shell. The project aims to unlock approximately 47.13 trillion cubic feet of natural gas.
Other key partners in this consortium are ExxonMobil, Pavilion Energy, Medco Energy, & Tanzania Petroleum Development Corporation (TPDC).
The PM informed lawmakers that while the initial plan focused solely on exports, the government is now negotiating to retain at least 3% of the extracted gas for domestic consumption. This is in meeting Tanzania’s growing local energy demand.
Another prioritized topic in the ongoing negotiation talks is the participation of Tanzanian enterprises.
Dr. Mwigulu asserted that Tanzanian President Samia Suluhu Hassan has ordered that local firms be empowered to help build a resilient economy & expand the national tax base.
The premier informed lawmakers that initially, 100% of extracted LNG was to be exported. However, with growing global energy demand, Tanzania has proposed that at least 3% of the extracted gas be returned for domestic consumption.
According to the premier, another key issue was the participation of local enterprises in this strategic project, as their involvement is crucial for ensuring that the benefits of the gas extraction are felt within the local economy and contribute to sustainable development. The proposal was with the intention of expanding Tanzania’s tax base.
The Premier reiterated that President Samia Suluhu Hassan has asserted that for Tanzania to build a strong economy & expand its tax base, the country must empower local enterprises. This was among the issues Tanzania considered important before the commencement of the project, he added.
Dr. Mwigulu was responding to a question from Mtwara Rural MP Arif Premji (CCM). The incident was when Premji sought clarification about the legal & policy challenges that were delaying the execution of the mega energy project in the southern region.
In his question, the MP noted that it has been approximately 12 years since Tanzania identified the project as a priority task, although its implementation is yet to begin.
Elaborating, Dr. Mwigulu said Tanzania has never implemented a project of such large magnitude. As such, there is a need for necessary measures to be taken for Tanzania’s benefit, including securing funding, establishing partnerships with experienced firms, and ensuring regulatory frameworks are in place to facilitate the project’s successful implementation.
Dr. Mwigulu promised to provide an update on progress made with the investors.
Shell & Equinor are key investors in Tanzania’s over 100-liter LNG project that aims to harness Tanzania’s deepwater natural gas reserves.
Located in Likongó in the Lindi Region, this flagship project is forecast to produce up to 10 million tonnes of LNG annually.
Shell & Equinor, together with other partners that include ExxonMobil, are pushing for a Host Government Agreement (HGA). This may be an important turning point in the project’s development.
