Prioritise locals in gas production, House committee appeals

BY EMMANUEL ONYANGO

22nd December 2013

The Parliamentary standing committee on Energy and Minerals has thrown a challenge to the government on the involvement of local companies in the production of natural gas mainly in the southern region of the country.

Committee member Victor Mwambalaswa (Lupa-CCM) made this appeal on Thursday evening, when summing up the committee’s report discussed by lawmakers for two days.

Transparency was needed to ensure that gas production is being conducted by Tanzanians and that the priority should be given to local companies, he said, underlining that prudence was important in order to ensure that locals are favored in the gas business in the country.
Elaborating, Mwambalaswa said mistakes of non-involvement of locals were committed in the recent past in the mining sector “and it would be shameful to repeat it again in the oil and gas sector.”

“Tanzanians have not yet been given opportunities to exploit their underground wealth as the higher authorities enter into contracts with foreign companies and relegate local companies to trading activities,” he stated.

Citing examples, he said that in the mining sector during allocation, foreigners were favored and made to acquire vast kilometers of mining land, causing a public outcry and the government does not take any action to review their contracts.

However, he appreciated the current system under the Tanzania Petroleum Development Corporation (TPDC) upon which locals could get oil and gas exploration blocks, as it was open to everybody and no one is hindered from applying.

“But we should also know that oil and gas drilling investment is hugely expensive, and thus the committee is asking Tanzanians who are able to come forward to compete in tendering and not just complain over allocation,” he urged.

The MP was referring to complaints surfacing recently that local investors were being denied access to the natural gas sector, on account of being poor and unable to afford the huge expenses incurred for exploration. 

Mwambalaswa also demanded that the government should repossess mining sites given to foreign companies and they seem to have failed to develop them, and instead such areas be handed to local investors. 

The committee also urged greater training of locals in relation to various activities in the natural gas sector, and continued enlightening of residents of Mtwara and Lindi regions on how they would benefit from the natural resource, to clear the worries abounding in the zone. 

TPDC also needs to work in collaboration with the National Insurance Company (NIC) to prepare insurance covers to local firms directly involved in exploration and production of natural gas, the committee suggested.

As for the oil sub-sector, Mwambalaswa said the government should direct the Energy and Water Utilities Regulatory Authority (EWURA) to designate fuel dispensing stations distributed in the rural areas.

He related that recommendation to the proliferation of substandard fuel dispensing units which endangers the quality of oil sold to the public, he added.

SOURCE: GUARDIAN ON SUNDAY