Mining and oil and gas reforms, a comparison between Kenya and Tanzania

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Hope for $30bn LNG project as villagers receive compensation​

TUESDAY MARCH 09 2021​

By Alfred Zacharia
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Dar es Salaam. The government has instructed 674 residents of Mbanja Ward in Lindi Region whose lands have been acquired for installation of the Liquefied Natural Gas (LNG) project to leave the area within 90 days after receiving their compensations.

A total of Sh5.2 billion has been paid to the residents, who sacrificed a total of 2,077 hectares, in compensation to those whose payments were delayed.

The LNG project manager, Ms Fedister Agrey, said they were going to take conceptual designs as well as other studies to figure out technical issues and make rough investment costs estimates before commencement of engineering, procurement and construction (EPC) works.

“As we are still waiting for the government to conclude the Host Government Agreement (HGA) negotiations with the international oil and gas companies, we are relocating people from the area to do preliminary works,” she said.

Studies that would be conducted in the area include the Preliminary Front End Engineering Design (Pre-Feed), the Front End Engineering Design (Feed) and the legal and commercial plans for the project.

The HGA negotiations were supposed to be concluded in December 2019, but it was delayed by review of the Production Sharing Agreements (PSAs) of existing contracts.

Some PSA issues seem to be contradictory or overlapping with the contracts set to be reviewed by the parliament before proceeding with the HGA negotiations.

However, she was not certain when exactly HGA negotiations would be concluded for the commencement of the $30 billion project.

“The HGA negotiations are beyond our boundaries because it depends on the decision by the Ministry of Energy. Therefore, I’m not sure when the final decision will be made,” she said in a telephone interview. The construction of the project with a capacity of processing 7.5 million tonnes of liquefied natural gas annually will be implemented for four to five years. The LNG processing will have a lifespan of over 30 years. The order for citizen’s relocation was issued yesterday shortly after completing the second phase of compensating with interests of all residents whose payments were delayed.

The Tanzania Petroleum Development Corporation (TPDCs) director of exploration, development and production for Oil and Gas, Mr Kelvin Komba said completing the payment of compensations was a good move ahead of the implementation of the LNG project.

Hope for $30bn LNG project as villagers receive compensation

The government has instructed 674 residents of Mbanja Ward in Lindi Region whose lands have been acquired for installation of the Liquefied Natural Gas (LNG) project to leave the area within 90...

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Tanzania Expects Agreement on LNG Project Within Six Months
Fumbuka Ng'wanakilala
April 29, 2021, 3:12 PM GMT+3
Talks resume May after president ordered speedy conclusion
Shell, Equinor urged nation to act quickly on stalled project
Samia Suluhu Hassan
Samia Suluhu Hassan Photographer: Inga Kjer/Getty Images
Tanzania expects to conclude an agreement for a $30 billion liquefied natural gas project within six months after the country’s new president called for a resumption of negotiations that had stalled for more than a year.

Talks for the host government agreement, or HGA, that will govern the tax, legal and commercial terms for the proposed two-train onshore LNG project fell apart in 2019. Plans for a plant on Tanzania’s southern coast connected to offshore fields by pipeline have been under proposal since 2014.


“The government’s negotiation team has already been formed ahead of the resumption of talks and we will be preparing from next week to restart negotiations with the investors as soon as possible,” James Mataragio, managing director of the Tanzania Petroleum Development Corp., said Thursday by phone.


Investor sentiment over Tanzania soured after the administration of former President John Magufuli overhauled mining legislation and ordered contracts renegotiated afresh. His successor, Samia Suluhu Hassan, told lawmakers last week the talks over the LNG plant had dragged on too long and pledged to finish them speedily so the project can be implemented.

One of the developers, Equinor ASA, took a $982 million impairment on the project in January, which it said would be reversible, after failing to settle terms with Tanzania’s government. Other project partners include Royal Dutch Shell Plc, Exxon Mobil Corp., Ophir Energy Ltd. and Pavilion Energy Pte.

Tanzania needs to demonstrate commitment to the project by “successfully restarting negotiations on the host government agreement and pledging to conclude them in a timely manner,” Frederik Grootendorst, Shell’s country chairman, and Mette Halvorsen Ottoy, Equinor’s country manager, said in an opinion piece in Dar es Salaam-based Citizen newspaper on April 13.

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Tanzania Expects Agreement on LNG Project Within Six Months

Tanzania expects to conclude an agreement for a $30 billion liquefied natural gas project within six months after the country’s new president called for a resumption of negotiations that had stalled for more than a year.

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Turning point as Tanzania's gold exports pass $3 billion mark​

WEDNESDAY MAY 05 2021​

Gold bars. In 2012, the UN gave Kenya a list of 15 suspected gold traffickers whose activities, it said, were funding wars in DR Congo. PHOTO | FILE | NATION MEDIA GROUP

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Summary​

• As financial markets were hit by the pandemic, investors rushed for gold which they consider as one of the safe haven assets.
• Since last year, gold exports overtook that of tourism which has been hit by Covid-19.

By Josephine Christopher
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Dar es Salaam. Tanzania’s gold shipment hit $3 billion mark for the first time as price of the precious metal increased in the world market.
According to the Bank of Tanzania, the value of the exports of gold to $3.025 billion in the year ending March 31, 2021, compared with $2.324 billion recorded previously.

Gold started attracting higher prices since last year following the outbreak of the Covid-19 which disrupted economic activities and markets around the world.

As financial markets were hit by the pandemic, investors rushed for gold which they consider as one of the safe haven assets.

Since last year, gold exports overtook that of tourism which has been hit by Covid-19.
During the year to March 2021, gold exports accounted for 55.9 percent of non-traditional exports after increased by $701.3 million to $3.025 billion. The increase is associated with “an increase in the market price of gold and government initiatives in supporting the mining industry,” the central bank stated.

“The rise in prices of gold and oil are, respectively, explained by cumulative impact of rising prices and subdued demand at the onset of Covid-19,” the BoT added in its monthly economic review for April.

On the other hand, revenue from tourism sector which was once the country’s leading foreign exchange earner reduced to $885.2 million at the end of March 2021 from $2.598 billion recorded in the same period last year.

Travel receipts declined due to containment measures instituted by various countries against the Covid-19 pandemic including lockdowns and travel restrictions. Consequently, the number of international arrivals declined to 514,625 from 1,511,944 in the year to March 2020.

Turning point as Tanzania's gold exports pass $3 billion mark

Tanzania’s gold shipment hit $3 billion mark for the first time as price of the precious metal increased in the world market.

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• East Africa
• Environment
• Gold
• Partners

ESG in action: Tanzania shows the way​

May 5, 2021


When Barrick took over operational control of its Tanzanian assets under two years ago, it faced daunting challenges: a government that was actively hostile to the mining industry in general and the former operator in particular; serious environmental issues which had halted production at North Mara; long-standing land disputes; allegations of human rights abuses; and a non-existent social licence to operate.

Since then, Barrick has formed a pioneering partnership with the government, through which they will share the economic benefits generated by the mines. These have not only been brought back into production but have been set on course to potentially become another Tier One complex for the company. Barrick has settled the land disputes and resolved other grievances and is dealing with historical human rights accusations in an open and transparent way.

Barrick has an absolute and unwavering commitment to minimizing the environmental impact of its operations, and its first priority was to fix the Tailings Storage Facility (TSF) and the water management situation at North Mara, says Grant Beringer, group sustainability executive.

The company will invest $65 million in water management initiatives, which has included an upgrade of the water treatment plant, increasing its capacity 16-fold, and has drained the excess water from the TSF, bringing it back to within its permit levels. The next big project is a brine plant, the first of its kind in African mining, which will reduce the volume of salts and increase their concentration to allow for safe storage in the TSF. This plant is scheduled for commissioning in the third quarter of this year.

Community development committees have been established at the mines, and through consultation with these and the authorities, Barrick reached agreement on land compensation rates. To date, almost all the compensation has been paid in a process overseen by the government, the local authorities and the affected communities.

Barrick has worked with independent specialists Avanzar to update its human rights policies, standards and procedures, and to develop human rights workshops for managers and supervisors, the first of which was held in January of this year. Avanzar has also conducted a human rights impact assessment.

The international security provider has been replaced by a local company with close community ties, the mines’ relationship with the police has been reviewed to establish clear boundaries, and arms and ammunition are no longer stored on site.

“While there is still a lot of work to be done, we are encouraged by the progress we have made in establishing Barrick’s social licence to operate in Tanzania and in transforming moribund mines into a valuable addition to our global portfolio. The fact that ESG is so deeply ingrained in Barrick meant that we did not have to invent a strategy for dealing with Tanzania — we simply applied our existing principles and procedures,” he says.

ESG in action: Tanzania shows the way

"We are encouraged by the progress in our social licence to operate in Tanzania and transforming moribund mines."

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LNG negotiations r back!

 

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Walkabout starts early works in Tanzania​

24th May 2021 BY: Esmarie Iannucci
CREAMER MEDIA SENIOR DEPUTY EDITOR: AUSTRALASIA

PERTH (miningweekly.com) – Graphite developer Walkabout Resources has started prestart activities at its Lindi Jumbo project, in Tanzania.
“The Lindi Jumbo mine is rapidly materializing and on track for first production in the second quarter of 2022. At Walkabout, we have always done what we said we would do, and it has been very rewarding finalising planning and project logistics this week,” aid CEO Allan Mulligan.

“Our focus in stage 1 and 2 construction are on those items on the critical path including the civils required for plant erection and the continued manufacture and shipping of plant equipment from our engineering, procurement and construction contractor in China.”

Walkabout in April this year secured a $20-million debt funding from CRDB Bank of Tanzania, and is in the midst of a A$7.6-million capital raise, which will close on June 25.

Alternatives for the final and third tranche of development capital raise are currently being assessed.

The Lindi Jumbo project is expected to require a capital investment of $32-million, including working capital and financing costs, with $3.6-million already having been spent on construction activities and on long-lead manufacturing items.

Over its 24-year mine life, the project is expected to produce some 40 000 t/y of graphite concentrate.

EDITED BY: Creamer Media Reporter

Walkabout starts early works in Tanzania

Graphite developer Walkabout Resources has started prestart activities at its Lindi Jumbo project, in Tanzania. “The Lindi Jumbo mine is rapidly materializing and on track for first production in the second quarter of 2022. At Walkabout, we have always done what we said we would do, and it has...

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