ZANZIBAR: Shell no nearer to Zanzibar deal

TANZANIA      Talks between Dodoma and Zanzibar on who gets to award exploration licenses in the       archipelago’s waters aren’t making much headway.   Shell has been seeking for over 10 years to convert the memorandum of understanding it signed with Tanzania in 2002 into a production sharing contract for blocks 9, 10, 11 and 12 in Zanzibar. But it’s unlikely any award will be made before 2014 because major constitutional changes are being discussed between Zanzibar and Tanzania’s central government. Decision-making powers could be transferred to the local authorities and thus no longer be exercised by TPDC from Dar es Salaam. According to our sources, Zanzibar’s new energy minister, Ramadahani Abdeallah Shaaban, is thinking of setting up a national oil company this year to be ready to organize a licensing round as quickly as possible in 2014. At present, only one official, geologist Omar Zuberi, works exclusively on oil at the ministry while four other civil servants deal with the island’s electricity supply. While Shell is far from being certain it will win acreage in Zanzibar’s territorial waters the Anglo-Dutch giant is already actively preparing for it. In early November, the Dutch ambassador to Tanzania, Ad Koekkoek, accompanied a delegation of businessmen from his country to Zanzibar. The group was led by senator and ex foreign minister Rene Van Der Linden. They met with the island’s vice president, Seif Ali Iddi, who promised that oil and gas exploration in the water around the islands would shortly fall under responsability of Zanzibar.