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Following two decades of domestic gas monetisation, Tanzania is East Africa’s most developed gas market. The country’s gas sector relies on two producing fields, Songo Songo and Mnazi Bay, which have largely supported the expansion of power generation and gas distribution to industries in Dar es Salaam, the economic capital.
The country’s gas sector is now on the eve of profound transformations. The commissioning of large-scale hydropower capacity is putting downward pressure on gas demand as hydroelectricity takes a bigger share in the electricity mix and puts gas turbines on the backburner, at least for now. But the existence of gas infrastructure, along with world-class offshore proven gas discoveries, could well support the growth of a competitive export industry. Spare gas capacity can be redistributed for domestic industries and support small-scale gas distribution to the rest of the region; while negotiations on the multi-billion dollar Tanzania LNG export terminal could make progress in 2025.
GDP (2023)
Proven Gas Reserves
Gas production (2024)
Population (2023)
Population in 2050
Tanzania’s proven gas reserves remain limited as LNG project awaits final investment decision
Tanzania’s natural gas sector is driven by the two producing hubs of Songo Songo (shallow offshore) and Mnazi Bay (onshore). The former is operated by Orca Energy Group’s subsidiary PanAfrican Energy and has been producing since 2004. Although currently in dispute, the asset remains the backbone of the country’s gas supply and power generation industry. Production notably feeds Dar es Salaam’s thermal power plants along with key industries such as cement, steel, glass, textiles and agroindustry – both via CNG and piped gas infrastructure.
On the other side, Mnazi Bay is located south towards the border with Mozambique and is operated by Maurel & Prom. Producing since 2015, the field has been instrumental in driving energy access in Southern Tanzania via the 18 MW Mtwara power station before a pipeline was built to transport gas further north to Dar es Salaam. Following a decade of successful operations, Maurel & Prom is launching in 2025 an $80 million, three-well drilling campaign at the field, targeting both infill production and new exploration.
Both Songo Songo and Mnazi Bay witnessed growing production in recent years as frequent droughts made Tanzania more and more reliant on gas-to-power for electricity supply. Between 2014 and 2024, gas production almost doubled, aided by the commissioning of the Mnazi Bay to Dar es Salaam pipeline in 2015.
Tanzania is now in the process of developing a third field, located next to Maurel & Prom’s Mnazi Bay infrastructure. The Ntorya Gas Project, piloted by Omani operator ARA Petroleum Tanzania (APT), was granted a development license in 2024 and could be Tanzania’s next producing gas field. To bring Ntorya to production, APT is expected to be drilling the Chikumbi-1 well to appraise the field before putting previous wells into production via workover interventions. Upstream infrastructure will be connected by pipeline to the Madimba gas processing plant, which already processes Maurel & Prom’s gas. APT could be producing as much as 60 MMscf/d soon, thereby tripling Tanzania’s gas production.
To process, transport and distribute its gas, Tanzania first relied on the associated infrastructure developed by PanAfrican Energy for the Songo Songo gas operations. These include a processing plant on Songo Songo island and a pipeline to Dar es Salaam.
But to monetize its gas reserves at the border with Mozambique in the south and meet increasing demand for gas in Dar es Salaam, state-owned Tanzania Petroleum Development Corporation (TPDC) had to expand the national backbone gas network.
In 2015, it commissioned a 532km, 36'' gas pipeline with a capacity of 784 MMscf/d to support the development of several power plants and manufacturing industries between Mtwara in the south and Dar es Salaam in the north. The project forms the pillar of Tanzania's National Natural Gas Infrastructure (NNGI) and included the 210 MMscfd Madimba gas processing plant in Mtwara, and a 140 MMscfd gas processing plant in Songo Songo with integrated compression and refrigeration facilities.
Inaugurated 10 years ago, the project offers an ideal evacuation route for several gas fields in the south of Tanzania and around the Songo Songo area, while providing a gas transportation route through most of Tanzania's coast. It has been instrumental in unlocking additional gas production from Mnazi Bay and supporting the future development of the Ntorya Gas Project.
Beyond pipelines, Tanzania is investing in compressed natural gas (CNG) production and infrastructure to truck gas to areas not yet reached by the pipeline network. This approach is particularly relevant for industrial customers and power projects in remote locations. The domestic CNG market is expanding rapidly, with more CNG refueling stations under construction. In December 2023, TAQA Dalbit, a JV between TAQA Arabia and JCG Oil & Gas, commissioned Tanzania’s first integrated CNG filling station and conversion centre, branded "Master Gas," with a capacity to serve 800 vehicles daily. It is the first of 12 planned stations, with over $10 million in investment aimed at expanding Tanzania’s CNG infrastructure in the coming years.
Tanzania’s gas sector is currently going through an adjustment phase for several reasons. While the legal dispute between PanAfrican Energy and TPDC crystallises tensions, the gas sector is also facing an evolution of demand.
Tanzania is currently commissioning one of Africa’s largest hydroelectric dams, the 2.1GW Julius Nyerere HPP. Such large capacity addition is making gas-to-power less attractive in a market where abundant and cheaper hydropower becomes available. The scenario provides the country with a unique opportunity to reinvent the role of its gas sector, first as a backup to hydropower and second as a driver of industrialisation.
Gas has played a growing role in providing reliable energy to industries in Dar es Salaam and its penetration across the country and the region could grow. Several small-scale and virtual pipeline solutions are currently under development to truck gas into the hinterland where industries and mines still rely on imported diesel and oil to generate electricity. Virtual pipelines could also easily reach neighbouring countries such as Botswana and Zambia, whose mines face similar energy supply constraints.
Long-term, Tanzania’s backbone gas infrastructure could also anchor regional trade opportunities. MoUs are already in place to transport gas to Mombasa in Kenya where several power plants rely on imported diesel/HFO, to Kampala in Uganda, and to Zambia. Such pipelines could cement the growth of existing and emerging trade corridors in East Africa and strengthen Tanzania’s regional position.
Tanzania’s gas market is undergoing a transformation. 2025 could provide additional impetus to the market with upstream activity driven by Maurel & Prom and Ara Petroleum, and potential progress on the Tanzania LNG negotiations. The 10mtpa, multi-billion-dollar LNG terminal that Shell and Equinor hope to develop with TPDC is what could truly propel Tanzania into the league of global gas markets. Meanwhile, domestic and regional opportunities provide short-term avenues for Tanzania’s gas reserves and its potential to be a leading energy player in East Africa.
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