Gas: Tanzania nears $42 billion deal, the largest investment in its history

Tanzania is on the verge of concluding a gas development deal estimated at $42 billion with Shell and Equinor, which would make it the largest single investment in its history, reports Africanews on October 15, 2026, citing Reuters. Tanzanian officials are presenting the project as a lever for the country's industrialization.

The project involves a liquefied natural gas complex fueled by approximately 47.13 trillion cubic feet of offshore reserves, with Shell operating blocks 1 and 4 and Equinor operating block 2, alongside the state-owned Tanzania Petroleum Development Corporation (TPDC). This volume would place Tanzania among the top six gas reserve holders on the continent, behind Nigeria, Algeria, Senegal, Mozambique, and Egypt.

Three years of standoff over revenue sharing

Negotiations had been at a standstill since 2023, after Dodoma requested a revision of a previously concluded fiscal agreement. The friction centered on legal frameworks, dispute resolution mechanisms, and revenue sharing between the state and investors: in other words, the share retained by the country owning the gas. In September 2026, the TPDC declared these conditions now "largely finalized."

The Director General of the TPDC, Mussa Makame, had specified on March 11, 2026, in Dodoma, according to the Tanzanian site The Chanzo, that a significant volume of gas would be reserved for the domestic market as part of the agreement. This is a decisive point for a country that wants to industrialize rather than simply export.

A plant in 2034, not tomorrow

Patience will be required. The complex plans for a terminal in Likong'o, in the Lindi region, with a capacity of up to 10 million tonnes of LNG per year. After the signing of the host government agreement, there must be a pre-engineering phase of two to three years, followed by the final investment decision, which analysts place closer to 2028-2029, with production expected around 2034, according to The Chanzo.

An East African energy corridor under construction

This project is part of a larger whole. The 1,443 km East African Crude Oil Pipeline connects Hoima in Uganda to the Chongoleani peninsula, near Tanga, on the Indian Ocean. The first exports of Ugandan crude through the Tanzanian port of Tanga are expected in 2027, according to Africanews.

The rest of the continent is moving along the same lines: Aliko Dangote has launched work on a $17 billion refinery in Kenya, and TotalEnergies relaunched in January 2026 the $20 billion LNG plant in Mozambique, which had been suspended since 2021 due to violence in Cabo Delgado. The question that will determine the real benefit for Tanzanians remains: local processing and the share of revenue, not just the amount announced.