OrPower secures Sh3.9bn loan for Olkaria project in Kenya

US energy firm OrPower 4 has receivedan additional Sh3.89 billion loan for the completion of its 100 megawatt Olkaria III geothermal project in Naivasha, Kenya, boosting the country’s quest for sufficient supply.

The amount forms the final draw from a Sh26.06 billion loan from the Overseas Private Investment Corporation (OPIC), an agency of the US government, through Ormat Technologies, Orpower 4’s parent company.

“This drawdown will be used to complete the final phase of construction at the Olkaria III complex in Naivasha, bringing the geothermal power plant capacity to over 100MW,” Ormat CEO Dita Bronicki said.

In May, Ormat began commercial operations of its Plant Two within the Olkaria III complex, increasing the company’s total generating capacity by 36 MW to 611 MW worldwide. Ormat also plans to add 16MW of generation by building a third plant, which it expects to complete in 2014.

Once Plant Three is complete total capacity at the Olkaria III complex will reach 100MW. The power is sold under a 20-year power purchase agreement (PPA) with Kenya Power.

Kenya has embarked on a wide range of renewable power generation projects in a bid to reduce dependence on unreliable rain-fed hydroelectric and thermal power.

Geothermal power investors get African Union backing for exploration costs

The African Union Commission (AUC) has invited geothermal power investors to apply for grants to fund initial exploration costs within the next one month.

The AUC partners with other donor organisations will finance geothermalenergy investors with an aim of promoting wide use of the renewable source of power in Africa.

On Wednesday, the commission signed a Sh722 million ($8.4 million) guarantee financing with the Africa Geothermal International Kenya Limited (Agil), which is exploring with a view to producing140 megawatts of electricity at Mt Longonot in Naivasha, Kenya.

“We will give infrastructure grants of up to 20 per cent of the costs… We will also offer surface study grants of up to 80 per cent of the costs excluding infrastructure costs,” said Rashid Abdallah, an energy expert at the Regional Geothermal Coordination Unit of the AUC.

The guarantee to Agil is only part of the Sh52 billion ($600 million) the company expects to spend on exploring, drilling wells and producing geothermal power at Longonot in the next five years. Drilling of wells is set to begin next April.

The AUC is collaborating with Germany’s development finance institution, KfW, in granting Agil the Sh722 million guarantee.

The funding offer by AUC is in line with a programme it initiated in 2010 through which itassists countries and regions to minimise the exploration risk associated with geothermal resources by funding the up-front cost, developing policy guidelines as well as institutional and regulatory framework.

The AUC also offers drilling grants of up to 40 per cent of the costs for the exploration, drilling and testing programme for reservoir confirmation wells, said Mr Abdalla during the signing for the Agil-AUC deal in Nairobi.

AUC is to fund a total of three projects in Kenya which succeeded in the first round of applications for grants. Out of the five projects that succeeded in the East African region, three are in Kenya and two are in Ethiopia.

In Kenya, the three projects are by Agil, government-owned Geothermal Development Company (GDC) and privately-owned WalAm Energy Inc. GDC is drilling at Bogoria-Silali area while WalAm is drilling at Suswa.

During the Agil-AUC signing ceremony on Wednesday, Energy Principal Secretary Joseph Njoroge said the country hoped to reduce the cost of power by 40 per cent once the major geothermal projects deliver power to the national grid by 2018.

“We expect that the geothermal power projects should help us reduce the cost of electricity in the coming years. Power prices should come down by 40 per cent within the next 40 months,” said Mr Njoroge.

The PS said increased power from geothermal production would help operate the standard gauge railway as speed trains are expected to run on it.

Agil chief executive Fassiné Fofana said the project will employ up to 1,000 people during the construction phase.

By Geoffrey Irungu
Source: Business Daily

Tullow strikes oil in new well.

“Tullow, through an e-mail on Thursday morning informed me of the discovery at the Agete well after drilling 1,930 feet,” Mr Chirchir told the Parliamentary Committee on Energy, Communication and Information last week.

Tullow says that the Agete-1 exploration well in Block 13T, onshore Northern Kenya, has discovered and sampled moveable oil with an estimated 100 metres of net oil pay in good quality sandstone reservoirs.

“A fifth consecutive oil discovery onshore Northern Kenya highlights the emerging world class exploration and production potential within our rift basin acreage.

An intensive campaign for 2014 includes appraisal and exploration within this first basin and pioneering wells targeting the prospectivity throughout the entire chain of similar rift basins,” Angus McCoss, Exploration Director, Tullow in a statement send to the media.

The commercial viability of the Lokichar find is yet to be ascertained, but hopes are rising that Kenya could become a petroleum producer and exporter.

This marks the first major announcement since Tullow Oil restarted operations in northern Kenya on November 8 after reaching a deal with local leaders to prevent a repeat of protests that halted work last month.

Tullow has operations on five on-shore blocks in Kenya, including 10A, 10BA, 10BB, 13T, 12A and 12B and a non-operated partner in off-shore block L8 where American exploration firm Apache Corporation is searching for oil.

Ethiopia wind farm starts production

Africa's biggest wind farm has started production in Ethiopia, aiding efforts to diversify electricity generation from hydropower plants and help the country become a major regional exporter of energy.

The country on the Horn of Africa is plagued by frequent blackouts. It plans to boost generating capacity from 2 000 megawatts (MW) to 10 000 MW within the next three to five years, much of it coming from the 6 000 MW Grand Renaissance Dam under construction on the Nile. The plan also consists of raising wind power generation to more than 800 MW and geothermal capacity to more than 100 MW within that period.

This shows that the Ethiopian government is committed to increasing its energy capacity. It also indicates to the outside world that the country is plagued by less of the socio political issues that stall or slow down projects in other African countries. Political will on projects is normally enough to get the job done.

Africa Energy Experts Convene in Denver

Press Release

Contact: Dr. Luka Powanga

303 458 4023  Lpowanga@thepowangagroup.com or Lpowanga@regis.edu

“Africa Energy Experts Convene in Denver”

Access to affordable, reliable, clean and economically viable energy supply is essential to Africa's economic growth and human development. Africa is well endowed in energy resources and has the potential to develop these resources to help create, grow and maintain vibrant global economies.

On November 7-8, 2013, hundreds of executives, policy makers and thought leaders from the private sector, national governments, non-government organizations, and academia from across the globe met at Colorado School of Mines in Golden Colorado (near Denver) for the Annual Energy Africa Conference to dialog, collaborate, encourage, invest in and support the work needed to supply clean, reliable and affordable energy in Africa. 

The focus of the conference was on President Barack Obama’s recently announced “Power Africa” initiative, and how Africa can leverage the synergy between natural gas and renewable energy sources to meet the current and future energy demand and the business opportunities inherent in the effort.

Prominent speakers and delegates included, Dr. Bill Scoggins, the President of Colorado School of Mines, Melvin Foote, the President and CEO of the Constituency for Africa in Washington, Michael Masserman, Executive Director for Export Policy and Strategy, United States Department of Commerce, Ambassador Irene Giner-Reichl , the Austrian Ambassador to China and Mongolia, Honorable Liberata Mulamula, the Tanzanian Ambassador to the United Stated, Honorable Palan Mulonda, the Zambian Ambassador to the United States, Honorable Jesca Eriyo, the Deputy Secretary of the East African Community based in Arusha Tanzania,  Michael McKelvy the president of Ch2Mhill, Dr. Ogunlade Davidson, the former Minister of Energy in Sierra Leone and now the Dean of the Graduate School at the University of Sierra Leone, Laetitia Mulamula, the Vice President of the Eastern Africa Diaspora Business Council, Professor F.D. Yamba, the Director for the Center for Energy Environment and Engineering in Lusaka, Zambia, Dr. Robert Stoner, the Deputy Director at the MIT Energy Initiative at the Massachusetts Institute of Technology and Co-Director of the Tata Center for Technology and Design and Christian Burgsmueller, the legal counsel for the European Union delegation to the United States.  Major corporation and institutions such as General Electric, Shell, the World Bank, Holland and Hart, Anadarko, EnCana Oil and Gas, Noble Energy, Regis University, Denver University, the World Trade Center, the ONE Campaign, and the Colorado Office of Economic Development were represented. 

The speakers highlighted the need to establish an energy infrastructure that meets the energy demand in Africa to ensure the current economic growth is maintained or even enhanced and how the synergy between natural gas and renewables could be leveraged to meet this objective.

With the help of several examples, honorable Liberata Mulamula, Palan Mulonda and Jesca Eriyo emphasized the business and investment opportunities available in the Energy Sector in Africa. They cited many areas of collaboration including the private-public partnership and how the issues of investment constraints that had in the past plagued the continent have been removed to catalyze investment and growth. Michael Masserman focused on the role that the Power Africa initiative will play in enhancing energy development in Africa and the business opportunities that this initiative presents.  Melvin Foote, the President and Chief Executive Officer for the Constituency on Africa stressed the importance of diaspora in the Energy infrastructure development in Africa.  He also stressed that companies wanting to do business in Africa, need to take into consideration the thoughts, ideas and aspirations of the next generation, who will be reluctant to accept corrupt business practices of the past.

The Energy Africa conference was well received by participants.  Hellen Kassa, with the Silicon Valley Technology Partners remarked,  “Thank you so much for putting together such an amazing conference. I honestly learned so much and was impressed at the level of diversity not only in speakers and attendees but at the topics covered and the level of expertise each speaker possessed”.   Leroy Wilson, a New York Attorney thanked the conference organizers for “doing an outstanding job!”   Dr. Ogunlade Davidson echoed these observations, “This well organized event provided an excellent opportunity to meet our American friends working on the same issues and this should continue as that will contribute greatly towards providing sustainable energy for all in Africa”.  Ambassador Irene Reichl remarked that “What made "Energy Africa" very special for me is that it draws on the hands-on experience of many experts from the energy sector and this enriches the dialogue on energy and sustainable development in an important fashion.”    Hon. Jesca Eriyo summed her experience at the conference: "The Energy Africa conference brought together academicians, experts, practitioners, CEO/business persons, and African Diaspora in the Minerals, Petroleum/Oil and Gas, power sectors as well as students. It was really enriching to listen to and participate in a very lively discussion throughout the conference, and to notice the enormous interest in investing in the Energy sector in Africa.”

Conference organizer Dr. Luka Powanga, who teaches at Regis University in Denver and operates a strategic consulting firm, “The Powanga Group”, was very pleased with the outcome of the conference.  Dr. Powanga noted that the conference highlighted the fact that Africa is clearly emerging and changing rapidly both in terms of economic growth and development and improved business environment.  Said Dr. Powanga, “Business opportunities for American energy companies are abundant in all aspects of energy development on the continent.  We are looking forward to playing a useful and pragmatic role in helping to build a strong US Africa energy partnership going forward”

UK firm AceOn Group to set up local solar generator assembly plant in Kenya

A UK based firm plans to set up an assembly plant in Kenya following the launch of its new solar generators in the country.

AceOn Group said it would assemble SolarSDS generators locally to cut shipment cost and make the kits affordable to households with no access to electricity.

“We shall import the kits for some time before we start assembling them locally soon,” Mark Thompson, the managing director and inventor of the solar kits said at the launch Thursday in Nairobi.

A complete SolarSDS kit comes along with a solar panel, LED lights and back-up generator with power storage capacity of between 300 watts and 1000 watts.

Additionally, the generator could be used interchangeably for storage of power from wind and solar sources and has an audio iPod docking station for entertainment.

The launch of the premium solar kits in the country is aimed at meeting power needs of growing middle-class with a penchant for outdoor social events.

These groups include those in camps, expeditions, exhibition stands, garden parties and even army troops during operations out in the jungle.

A complete SolarSDS kit will cost between Sh100,000(US$1,170) and Sh65,000(US$765) for the high and low power capacity generators respectively.

The new kits, Mr Thompson said, are waterproof and portable making them suited for outdoor functions.

In addition to a local assembly line, the firm said it was looking to partner with a microfinance institution in a deal that would see households in rural areas access cheap loans for the financing of the solar kits to boost uptake.

“It is something we are working on to capture the broad bottom market,” Mr Thompson said without disclosing the likely financial institution for a tie-up.

Recently, use of alternative renewable energy sources, especially solar energy has gained currency in the country on the back of increasing cost of hydro-based electricity after the State’s imposition of 16 per cent tax up from previous 12 per cent.

Growing advocacy campaigns in adoption of green energy has also seen players tap into the sector with a view to grabbing emerging business opportunities.

A recent report by the International Finance Corporation (IFC) projects that Africa is set to become one of the biggest markets for solar lamps by 2015 owing to right conditions for use of these kits.

Global giants Total, Panasonic and Energizer have shown interest in venturing into the country’s solar energy sector.

Source: Business Daily Kenya

By Neville Otuki

Tullow Oil to resume drilling in Turkana, Kenya

Tullow is to resume drilling at its sites in Turkana County, Kenya after signing an MOU with local leaders. British independent upsteam petroleum company will double its social budget, train locals and open up its tenders to women and youth from areas in which they operate, it was announced Thursday 7th November.

The company made the promise under a deal brokered by government officials to enable it resume operations in Turkana County Friday morning.

The British firm committed in an MoU signed with Turkana leaders to immediately double its social investments to Sh340 million annually and offer more training scholarships to enable locals take up high cadre jobs.

In exchange, the government will beef up security to protect the firm in an areathat is infested by small firearms.

“This is a working formula and a way forward to ensure that the community does not disrupt Tullow’s operations again in future,” said Kenyan Energy and Petroleum secretary Davis Chirchir.

“The increased social budget should be added to what is available from the Equalisation Fund to boost the capacity of Turkana people to benefit from oil exploration.”

Tullow indefinitely suspended its operations in Southern and Central Turkana on October 26 after community leaders organised residents to protest alleged discrimination against locals in employment and award of tenders.

In the MoU signed with Turkana Members of Parliament Thursday, Tullow management pledged to regularly share information about tenders and employment opportunities with local communities.

A big chunk of the firm’s tenders will also be reserved for the locals, Tullow officials said. “We now have a better understanding of issues than before and I am reasonably sure that matters will henceforth be resolved peacefully,” Tullow’s deputy general manager Sid Black said.

To the community, however, the heightened exploration has raised expectations withcounties demanding a role in the management of oil resources in spite of a constitutional provision that puts it in the hands of national government.

“Four rigs were running by the time of protest, and beside the direct losses suffered so far in the grounded operations, it will take us up to two weeks to get to where we were in October,” said Mr Black.

“I don’t want to disclose the amount of financial losses we have due to suspension of our work, but I can assure the figure is quite substantial.”

Generally, an oil explorer is allowed to recover all the costs incurred during the operation. Under the MoU signed Thursday, however, Tullow will have to absorb all the losses after it took responsibility for creating conditions under which the losses were made.

The firm says 58 per cent of the slightly over 2,000 workers in its payroll were hired from the surrounding communities. The local leaders have accused Tullow of confining locals to low-paying manual jobs and locking them out of tenders.

The last month’s protests begun after community members disagreed with the company management over the award of tenders to supply transport services.

Turkana South MP James Lomenen said the company had invited tenders for 2,000 transport vehicles, but later changed its mind and hired vehicles from outside the county despite locals having borrowed loans to buy the vehicles.

“We welcome investors but Tullow must be sensitive to our culture, needs and learn to disclose full information about its operations,” said Mr Lomenen. “We have signed several MoUs with them (Tullow officials) in the past with regard to distribution of jobs and tenders but these are ignored immediately the stalemate at hand is resolved.”

East African Oil & Gas Summit 2013 – 2013 in Perspective

The East Africa Oil and Gas Summit 2013 was held in Nairobi on the 29^th & 30^th of October. This year’s event was held under a backdrop of unprecedented growth and development in the upstream oil and gas sector in Eastern Africa.

Some of the highlights include:

1.     Uganda’s Tullow fields moving forward towards development and eventual production with the government approving the process after a mid-sized refinery was accepted by stakeholders as part of the deal.

2.     In Tanzania a new round of bidding for oil and gas blocks got underway in October, with Government expected to take between 65 -75% of PSA under free carry terms. The development of a gas pipeline from Songo Songo gas fields to Dar es salam continues.

3.     In Kenya, Tullow is moving towards commercial viability as assessment wells continue being spudded. Offshore Anadarko and BG have supped gas well in the recent weeks.

4.     Tullow and Africa Oil spudded their first Ethiopian wells early 2013.

5.     In the former Sudan, South Sudan and Sudan began pumping, transporting & exporting oil from the South’s oil fields after hostilities led to the closing down of the pipeline and oil fields in the south in early 2013.

6.     In Somalia the government issued its first exploration license to British company Soma Oil in over twenty years.

However, risks lurk in the shadows. Local content disagreements over jobs and contract allocations with the Turkana community in northern Kenya forced Tullow to shut down drilling operations after sustained demonstrations in October 2013. Earlier in the year, Tanzania faced a similar situation with locals along the Songo Songo pipeline protesting that the gas pipeline was passing through their lands while they were not benefiting from it.

There seems to be a lack of capacity in terms of up scaling local content in the East African countries as the oil and gas discoveries seem to have caught these countries unawares with legislation appearing to chase oil and gas development. The only country to date with a comprehensive oil and gas policy as regards to local content is Uganda. Kenya’s will only be ready by earliest 2016 according to industry participants involved in the process.

This leads us to another risk; Regulation Risk. With regulation and policies currently being reviewed to suit current and future needs of the industry this risk is a huge concern for companies. In other parts of the world changes in regulation have led to companies rejigging their strategies or withdrawing altogether. This is because investors give them money for oil and gas exploration based on certain assumptions underpinned by stable regulatory, policy and legal frameworks that make risks measureable. For most of the companies in Eastern Africa this remains a risk.

Its now coming to the fore that oil and gas like most extractive industries is very capital intensive yet creates proportionally far less jobs in relation to other industries such as services and manufacturing. Therefore, at the moment the focus of governments and all key stakeholders in East Africa should be to create employment in the support services industries that cater to the industry. This is the game changer, investing in support services such as logistics, transport, accommodation, and catering and non-core technical support services such as providing generators, sanitation, and security. The governments should put minimum requirements as regards to contracts awarded and employment to locals in their countries. This will ensure a quicker up scaling of skills in these sectors. The core technical skills such as drilling, welding, geology and geospatial engineering should take between 5 to 10 years to develop. There should be a strategy embedded in policy to fast-track the uptake of these skills in this sector.

However, entrepreneurial locals with seed capital can partner with companies from markets where the oil and gas industry is more mature and begin developing these skills and capabilities to prepare for when the industry will really boom in the coming years.

Infrastructure presents a huge risk because without pipelines, ports and airports etc., oil and gas cannot be exported to markets where its needed. However, the governments of this region have grand plans to upscale infrastructure. The question is whether they will be ready on time and who will pay for them.

The last issue on hand is that of security and political stability. With the recent terrorist attack at the Westgate Mall in Nairobi, that targeted an establishment that is frequented by foreigners and expatriates, security is clearly an issue that presents a huge risk. Investors shy away from investing in unstable or unsecure areas. Even when they invest they then have to invest heavily in security which erodes their margins and hence eventual return. It is therefore imperative that the governments in the region continue to foster peace and stability within and without their borders. With initiatives such as those of stabilizing Somalia and DR Congo should be given utmost support especially from regional countries and the international community at large. Because instability in one country has knock on effects in neighbouring countries where criminal elements move across borders to cause insecurity and instability.

The future looks bright for the Eastern Africa’s oil and gas industry but along the way risks lurk that could derail the boom that is in the offing.

World Geothermal Energy Summit 2013

Date and Time	World Geothermal Energy Summit 2013 Thursday & Friday, 5-6 December 2013 9:00 AM – 5:00 PM
Venue and On-site Contact	The Boma Hotel Red Cross Road (off Popo Road, off Mombasa Road), Bellevue – Nairobi, Kenya T: + 25420 390 4000 | F: + 254 20 604 520 http://www.bomahotels.com     On-site Contact Mr Rex Ian Sayson Arc Media Global Onsite Mobile: (TBA) Pre-event Contact: +65 6818 6344
Dress Code:	Business Attire
Registration:	Starts at 8:30AM

For further details on the event click on the following link or copy it onto your web browser: 

https://dl.dropboxusercontent.com/u/82381277/82482_41_partners.html

See you there.......

General Electric now gets licence for 61MW Kinangop wind power farm

General Electric is today set to get a licence to develop a wind power farm in Kinangop, paving the way for the start of construction of the 61 mega watts project.

The Energy Regulatory Commission (ERC) is set to issue the licence for the Sh12.7 billion ($150 million) project to be developed jointly by GE and Aeolus Kenya.

It is expected to feed power to the national grid by mid 2015.

ERC acting director-general Fredrick Nyang said that in addition to issuing the power generation licence, the regulator had also approved the power purchase agreement for the project.

“With the approval of the PPA and the issuance of licence, they are expected to start construction within the next one year.

‘‘The PPA approvals are what they use in finalising their debt and financing arrangements,” said Dr Nyang in an interview.

He said that in addition to licensing the project developers, ERC had also issued a licence to Ketraco for construction of power lines to transmit electricity from the project to the national grid.

The project will be a boost to Kenya’s plans for tapping renewable energy to raise capacity beyond the current total of 1,600 MW.

Spanish firm Iberdrola Engineering announced last month that it had signed an agreement worth Sh9.7 billion (€85 million) for the construction of the Kinangop wind farm.

According to the Iberdrola statement, the project will be owned by the Macquarie and Old Mutual sponsored African Infrastructure Investment Fund II and the Norwegian Investment Fund for Developing Countries (Norfund), with South African Standard Bank acting as Mandated Lead Arranger for the deal.

“The Iberdrola subsidiary will handle engineering, procurement, construction and commissioning. The project will have a total of 38 wind turbines manufactured by General Electric.

‘‘The hubs for each 1.6MW wind turbine will stand almost 80 metres and have a rotor diameter spanning 82.5 metres,” said Iberdrola.

The company is also part of a consortium putting up a 13.6MW wind farm for KenGen in Ngong Hills, and Ketraco’s Nairobi Ring Project which will see an overhaul of the capital’s power distribution network. Both projects have a combined value of over Sh7.5 billion.

As the lead financial arranger for the project, Standard Bank Group (and its subsidiary CfC Stanbic Bank) announced on October 3 that it had underwritten a Sh7.65 billion ($90 million) debt deal with Aeolus Kenya.

According to Kwame Parker, Standard Bank Group’s East Africa Head of Debt Solutions and Infrastructure Finance, the transaction will be fully funded through a combination of debt and equity.

In addition to Standard Bank’s $90 million debt deal, two international partners in the deal, likely Norway’s Norfund and GE, are expected to provide $60 million (Sh5.1 billion) in the form of equity funding.

GE is likely to contribute a maximum of Sh3.5 billion for financing the project in line with its current policy of contributing between Sh1.7 billion ($20 million) and Sh3.5 billion ($40 million) for power ventures in Kenya.

GE’s plan is to take up equity or shareholding of between five and 10 per cent in similar power projects in the region.

The company is also participating in the Sh14 billion ($160 million) Kipeto wind project in Ngong, slated to produce 100MW.

GE expects to take up equity of about $16 billion or 10 per cent of the total worth of the project.

By Charles Mwaniki

Source: Business Daily Kenya

Tanzania puts dimmer on electricity theft

Tanzania Electric Supply Company’s (Tanesco) automatic meter reader (AMR) has helped the national power supplier cut down on electricity theft among big users since the gadget was introduced mid this year.

Tanesco acting managing director Sophia Mgonja says the AMR system had helped them cut the theft of electricity, especially among industries, to almost zero.

“The system has helped us eliminate the theft of electricity which was being perpetrated by many big power users. The AMR helps to show everything done in the industry and how the power is actually used,” she said, according to the Tanzania Daily News. Mgonja challenged big power consumers to install the gadget because it helps save energy.

Mgonja said the government and Tanesc planned to come up with strategies to eliminate wasteful use of power and to make power available to more communities.

China signs US$ 1.7 billion dollar deal with Tanzania

Tanzania has signed contracts worth US$1.7 billion dollars with Chinese companies to construct power plants and housing units in east Africa’s second-largest economy. The new investment deals mark China's growing economic presence in Tanzania, which has made big discoveries of natural gas off its southern coast.

“The government has today signed seven agreements with six Chinese companies worth US$ 1.7 billion, which will be invested in power plants and construction of residential and commercial housing projects,” the Tanzanian prime minister’s office said.

The deals include a US$ 692.7 million contract awarded to Tebian Electric Apparatus Stock Co Ltd, China’s largest manufacturer of high-voltage transformers, for the construction of a 400 kV power transmission line.

Baobab explores Mozambique energy options

UK miner Baobab Resources says it will jointly commission, with Mozambique’s publicly owned electricity company, EDM, a detailed study for the power needs of its pig-iron project in the western province of Tete.

The memorandum of understanding follows the Mozambican government's unconditional approval of Baobab's environmental impact scoping report.
Baobab is examining a range of scenarios that could see Mozambique host the largest pig-iron operation in the world.

It is planning to produce low impurity pig-iron using ore from its Tenge/Ruoni deposit in Tete and locally mined thermal coal. It is currently focusing on the feasibility of building a facility to produce two million tonnes of pig iron per year.

Tanzania opens bids for gas exploration

Tanzania has invited bids for eight blocks and said late in October it would take a stake of up to 75% in each of the new production-sharing contracts. The country is a hotspot for natural gas exploration.

“The production-sharing formula will either be 35% to investors and 65% to the government or 25% to them and 75% to us,” Tanzanian President Jakaya Kikwete said.

Tanzania, which has made big discoveries of natural gas off its southern coast, is offering seven deep-sea offshore blocks and one block in Lake Tanganyika.

Kikwete said the government would consider selling stakes held by the state-run Tanzania Petroleum Development Corporation in production-sharing agreements to Tanzanians through initial public offerings.

Officials said the state-run development corporation will apply the rule on stakes during the development phase in oil and gas projects and will not participate during exploration.
Tanzania has so far signed 25 production-sharing agreements with about 17 international energy companies, including Royal Dutch Shell and Exxon Mobil.