CAPE TOWN, SOUTH AFRICA – November 5, 2024
Tanzania has announced that it will auction 26 petroleum exploration blocks in its fifth licensing round, set to open on March 5, 2025. The announcement was made by Dr. James Mataragio, Deputy Permanent Secretary of the Ministry of Energy (Gas and Oil), during the African Energy Week conference held in Cape Town, South Africa.
According to Dr. Mataragio, of the 26 available blocks, 23 are located offshore in the Indian Ocean, with the remaining three situated in Lake Tanganyika. Investors were invited to take part in the upcoming auction, which marks a significant step for Tanzania as it aims to bolster its oil and gas sector by attracting international interest and capital.
Mataragio encouraged potential investors to explore partnership opportunities with the Tanzania Petroleum Development Corporation (TPDC) in key blocks such as Eyasi-Wembere, Mnazi Bay North, and Songo Songo West. He noted that detailed datasets for each block, including gravity, magnetic, 2D and 3D seismic, and well data, would be available for review, enabling investors to assess the resource potential and make informed bids.
The government has taken steps to enhance the attractiveness of this licensing round by finalizing updates to the Model Production Sharing Agreement (PSA). Dr. Mataragio explained that these updates aim to improve terms around royalty rates, cost recovery limits, profit splits, state participation, rental fees, bonuses, and taxes. “We are committed to creating favorable conditions for investors and ensuring a transparent and profitable licensing process,” he said.
Tanzania, with over 70 years of experience in the petroleum industry, is positioning itself as a top investment destination for oil and gas. Recent efforts to improve infrastructure, streamline investment processes, and launch strategic projects like the Mwalimu Julius Nyerere Hydropower Project (JNHPP) underscore the government’s dedication to a thriving energy sector.
The March 2025 auction follows the recent announcement at the Africa Oil Week conference, where Deputy Minister for Energy, Ms. Judith Kapinga, disclosed that Tanzania will promote its upcoming blocks during the East African Oil and Gas Conference and Exhibition. This licensing round will span 24 blocks across both onshore and offshore sites, primarily in the Indian Ocean and Lake Tanganyika.
Zanzibar has also announced its plans to auction eight blocks, totaling over 31,883 square kilometers, with promising hydrocarbon potential yet to be commercially realized.
In line with the global transition to sustainable energy, Tanzania continues to expand its use of natural gas, which is now a significant contributor to electricity generation, industrial applications, and household energy. With the upcoming auctions, Tanzania aims to further leverage its estimated 57 trillion cubic feet of gas reserves, primarily found in offshore fields, while fostering economic growth and attracting global partners.
Through updated policies and strategic infrastructure, Tanzania is signaling its readiness to become a leading player in Africa’s oil and gas sector. The upcoming auction of exploration blocks could unlock new avenues of energy development, benefitting both the nation and investors.
