TANZANIA is expected to sign a deal for a $1,06bn loan from China
The energy minister said Tanzania is expected to sign a deal for a $1,06bn loan from China to build a natural gas pipeline from the southern part of the country to its commercial capital. The government was seeking loans from China to finance the construction of the pipeline from Mtwara to Dar es Salaam, William Ngeleja, Energy and Minerals Ministersaid in a presentation to parliament last month.
This week, Mr. Ngeleja and Finance Minister Mustafa Mkulo were expected to fly to Beijing to sign the loan agreement, the Guardian on Sunday newspaper reported. It added that $300m of the loan will be used to construct processing plants at Mnazi Bay. Tanzania’s chronic energy shortages have undermining economic growth. It was because it has resulted in rolling power outages. In a bid to wean the country off weather- dependent hydropower, the government planned to shift its focus to investment in thermal plants fuelled by coal and natural gas.
The project will be state-run Tanzania Petroleum Development Corporation and carried out by the Technology Development Company, a unit of China National Petroleum Corporation and China Petroleum. In December next year, the project is expected to start. Amid growing energy demand in East Africa’s second-largest economy, an existing natural gas pipeline owned by private investors faces capacity constraints.