nngu007
JF-Expert Member
- Aug 2, 2010
- 15,862
- 5,797
CONTRACTS REVIEW IS A PUBLICITY STUNT AND CREATION OF UNNECESSARY UNCERTAINTY IN THE SECTOR - ZITTO KABWE
Irresponsible statements by the Minister of Energy and Minerals will cost our country dearly not only in developing the crucial Oil and Gas but also in attracting foreign direct investment. What is needed in Tanzania is transparency of contracts, sanctity of contracts and building the crucial capacity of TPDC and not mere words from the Minister who actually signs the contracts.
Announcing review of all production sharing agreements (PSA) to be done by the new board of TPDC is simply a publicity stunt by the Minister. What the Minister is unaware of and totally ignorant of is the fact that many reviews have been done and nothing has been done about it. The Parliamentary committee on Public organisations (POAC) had asked TPDC through the office of the CAG to audit all the contracts. Out of 26 contracts, only 4 were audited and one (PanAfrica Energy) was found to have inflated their costs to the tune of USD 26 Million. So review will add nothing except earn short lived publicity for the Minister for his cow boy approach while throwing the sector in huge UNCERTAINTY and slowing down momentum.
Borrowing the words of the US President Barack Obama…..The Minister is shooting first and aiming later portraying a confrontation approach that is ill-advised. His approach on how he is handling this sector will cost our country dearly. The oil and gas companies are very cautious and one thing is certain : they don't work in uncertain environments where contracts are under threat of being revoked.
What is needed in Tanzania is TRANSPARENCY. The contracts must be made public and the new law must give powers to Parliament to approve the contracts. That is the transformation we need to ensure that our country benefits from it's resources. If the Minister is serious about walking the talk he must bring these amendments to Parliament instead of uttering irresponsible statements in press conferences.
Another sensible radical transformation needed now is the enactment of the Petroleum Revenue Management act. It doesn't help just mentioning ‘revenue must not go to treasury'. We must be clear on how we will use this income now to ensure all Tanzanians and their children see the benefits. Establishment of sovereign development fund instead of a sovereign wealth fund shall be a unique departure for Tanzania from the resource curse other African countries are suffering.
We (Tanzania) are competing with Mozambique to build the first LNG plant to supply the Far East Asian markets out of East Africa. While our neighbors are working hard and on time, we do the talking.
This must end
Zitto Kabwe
Shadow Finance Minister
Borrowing the words of the US President Barack Obama…..The Minister is shooting first and aiming later portraying a confrontation approach that is ill-advised. His approach on how he is handling this sector will cost our country dearly. The oil and gas companies are very cautious and one thing is certain : they don't work in uncertain environments where contracts are under threat of being revoked.
What is needed in Tanzania is TRANSPARENCY. The contracts must be made public and the new law must give powers to Parliament to approve the contracts. That is the transformation we need to ensure that our country benefits from it's resources. If the Minister is serious about walking the talk he must bring these amendments to Parliament instead of uttering irresponsible statements in press conferences.
Another sensible radical transformation needed now is the enactment of the Petroleum Revenue Management act. It doesn't help just mentioning ‘revenue must not go to treasury'. We must be clear on how we will use this income now to ensure all Tanzanians and their children see the benefits. Establishment of sovereign development fund instead of a sovereign wealth fund shall be a unique departure for Tanzania from the resource curse other African countries are suffering.
We (Tanzania) are competing with Mozambique to build the first LNG plant to supply the Far East Asian markets out of East Africa. While our neighbors are working hard and on time, we do the talking.
This must end
Zitto Kabwe
Shadow Finance Minister
Wiki iliyopita niliandika mawazo yangu haya kuhusu sekta ya Mafuta na Gesi Tanzania. Bahati mbaya sana haikuwekwa hapa kwenye mjadala. Ni vema kuiweka maana masuala haya yanafanana.
Chini kwenye links nimeweka majibu ya Prof. Muhongo katika mawazo yangu haya. Sasa mlinganishe masuala yote haya kwa pamoja ili mjadala wetu uwe na maana.
Oil and Gas in Tanzania: Building For A Sustainable Future-A Call for a Moratorium on new offshore exploration.
Oil and Gas in Tanzania: Building For A Sustainable FutureA call for a moratorium on new offshore exploration.Tanzania is on the precipice of an economic evolution with the recent discoveries of gas. We have now confirmed reserves of 43 Trillion Cubic feet (TCF), roughly valued at USD 430bnhttp://us.mg4.mail.yahoo.com/neo/#_edn1. Plans for LNG production are moving ahead of schedule. As a result there will be considerable new gas resources available for power generation and other needs for our economy and people including domestic use, petrochemical industries and fertilizer plants.
Oil and Gas Industry
Picyure courtesy of: Cypressmfg
Our nascent oil and gas industry is set to expand greatly with the upcoming Fourth Licencing Round, which, according to Minister Sospeter Muhongo, is scheduled to be launched in Houston, Texas on September 13. We are now informed that the licencing round has been delayed. This is not enough and more work needs to be done.
The Fourth Licencing Round should be put on hold – postponed for ten years. In this, we echo the demand of Parliament's Energy and Minerals Committee earlier this year (April 2012, Annual Report of the Committee) and the concerns of other informed citizens. It is very unfortunate that the recommendation to postpone the licensing round, supported by a Parliamentary Committee on Public Investments (POAC) and approved by a Parliamentary resolution, was largely ignored by the Ministry and TPDC. A moratorium will not only allow us to manage our new resources effectively it will also ensure the welfare of future generations. This is something the Government must take seriously.
We, as responsible leaders, have a duty to safeguard this country's resources for future generations. This will require effective and sustainable management of our oil and gas reserves. The licencing round for the oil and gas offshore blocks announced by the Ministry through TPDC undermines our mandate to the Tanzanian people. If all exploration blocks are being licenced, what will our grand-children and great-grandchildren, who will be more educated and well prepared, do? It is critical that we approach these issues not in a short-term strategic thinking but long-term. We may not be here tomorrow but Tanzania will be.
We are not prepared for an expansion of exploration activity. Current legislation is out-dated and does not mirror the current political and economic status quo. We have no overarching Gas Policy, however progress has been made as both the Gas Act and Policy are currently being crafted. Nevertheless to continue on with a new round of licensing before these policies are complete is irresponsible. More importantly, we do not have legislation that will manage revenues from the sector. We need more time for the policies and legislative acts to be implemented. We will also need more time for institutions to be in place.
A ten-year moratorium will give us the space to develop our capacity in key areas. TPDC can be overhauled to become an active exploration and production company, modelled on Malaysia's Petronas. Currently, TPDC does not have the capacity or resources to be an effective and strong partner in developing our reserves. These capacity deficits include the ability to conduct basic geological surveys, contract negotiations and management as well as production and processing. A moratorium will allow us to support TPDC to become a strong and reliable trustee and gatekeeper of the country's resources.
A ten-year moratorium will allow us to build the necessary institutions that we will need to effectively benefit from these resources. These include establishing and supporting a Sovereign Development Fund, to manage revenues; coordinating with our educational institutions to train and foster young Tanzanians so they can confidently work and engage in this industry; and an oversight committee that would include parliamentarians, civil society organizations and local communities. These stakeholders would be mandated to ensure that our resources are used effectively and fairly.
A ten-year moratorium on offshore exploration will ensure that our increasingly young population will enjoy the benefits of our natural resources for generations to come. We kindly request the Government to stop any new licencing of exploration blocks and refocus all efforts into building the capacity to manage the discovered resources, make wise decisions and prepare the nation for a Natural Gas Economy in a timely manner.
Our past mistakes in the mining sector should guide us, as we comprehend the challenges and opportunities presented by the oil and gas sector. The country must first build strong accountability measures, ensure transparency, develop critical human capital and learn from case studies of other gas economies before licencing any new blocks. We need to think strategically and understand the long-game rather than thinking about short-term gains. As a result, we think 10 years will be enough to implement the necessary interventions and build a strong and sustainable oil and gas economy for all Tanzanians.
Kabwe Zuberi Zitto, MP
Shadow Minister of Finance.
http://us.mg4.mail.yahoo.com/neo/#_ednref1 using rule of thumb that 1TCF equals to 10bn US
********************************
REACTION>>DAILY NEWS
MP for 10 yr hold in licensing gas exploration
URL: http://www.dailynews.co.tz/index.php/local-news/9381-mp-for-10yr-hold-in-licensing-gas-exploration
IPP MEDIA
News Muhongo questions Zitto stand on gas exploration
URL: Home
Ni maoni yangu kwamba kupitia mikataba ya mafuta na Gesi ni suala la kisiasa tu na hakuna lolote ambalo litafanyika maana tumeshafanya mapitio sana na hakuna utekelezaji. A radical approach is needed in all matters about our resources, not piecemeal reviews which add no value.
Pili, mikataba hii yote inasainiwa na Waziri wa Nishati na Madini, TPDC na Kampuni ya utafutaji. Sioni mantiki yeyote ile kwa Waziri kuitaka TPDC kupitia mikataba hii. Ndio maana nashauri kwamba mikataba iwekwe wazi. Hakuna mapitio bora zaidi kama kuweka wazi mikataba hii. Uwazi ni mapitio tosha.
Ni maoni yangu kwamba Waziri wa Nishati na Madini ana mapungufu makubwa sana na ndio maana anajihami sana katika maamuzi yake. Hafikirii sawa sawa na wala haoni madhara ya anachosema. Siku sio nyingi mtathibitisha ninachosema. Matamshi mengi aliyoyasema Bungeni wakati wa mjadala wa hotuba ya Bajeti yake yalikuwa ni uwongo na ameshindwa kuthitibisha na kuishia kusema "mimi niliambiwa na Katibu Mkuu".