- The natural gas reservoir agreements will reshape the energy landscape in East Africa with far-reaching implications for both countries.
- The complex and delicate resource sharing has led both nations to the negotiation table, recognising the potential for significant overlap in the gas reservoirs.
Tanzania’s Petroleum Upstream Regulatory Authority (Pura) and Mozambique’s National Institute of Petroleum (INP) are planning to sign an agreement on the equal share of the natural gas reservoir in the border area, The Citizen Tanzania reports. The proposed unitisation agreement, revealed yesterday during a meeting between media editors and the Pura management, will reshape the energy landscape in East Africa and have far-reaching implications for both countries.
Unitisation is the process whereby the holders of each license jointly develop an oil or gas reservoir straddling multiple license areas. The CEO of Pura, Charles Sangweni, said the agreement’s essence stemmed from these gas reserves’ unique geographical location. Unlike traditional border disputes where the demarcation lies within the land, in this case, the gas deposits span over an area that transcends both national boundaries.
The complex and delicate matter of resource sharing has led both nations to the negotiation table, recognising the potential for significant overlap in the gas reservoirs. The focus of their research has extended to the South of Tanzania, where blocks 4/1B and 4/1C overlap the border with Mozambique. On the other side, Mozambique has already discovered an impressive 172 trillion cubic feet of gas in the Northern belt area, specifically in blocks 5/A and 5/B. It is now believed that these reservoirs may overlap into Tanzanian territory, prompting further exploration.
Mr Sangweni emphasised the global precedent of unitisation agreements in such cases, whereby countries collaborate to share resources when reservoirs overlap. He stated, “To implement this, we have been in contact with our colleagues through the Ministry of Foreign Affairs and our ministry (the Ministry of Energy) so that we can now enter into a Memorandum of Understanding that will bring cooperation on many things, including entering into a unitisation agreement.”