GOXI

sharing in governance of extractive industries

Upstream content is a must foundation of Tanzania’s natural gas policy which delivers optimal empowerment of locals in the development of national economy.

Tanzania’s new natural gas policy announced recently is founded on fault belief that it is only the well funded and experienced foreign oil and natural gas investors could handle the most rewarding upstream natural gas prospects generation and appraisal, from which opportunities would be generated for locals to invest in the midstream and downstream natural gas activities which would evolve.

It is a fault basis Tanzania’s new gas policy is founded on because the most important pursued for in the development and exploitation of non-renewable mineral resources like oil and natural gas is the natural capital inherent in them, which is also source of most seed capital involved in the upstream natural gas prospects appraisal, and the midstream and downstream activities which would evolve.

Main of what would make Tanzania’s new natural gas policy operational in the delivery of national expectation is the upstream content, which should be optimal in ensuring all commercial natural gas finds made in the country are empowerment sources of the seed capital needed to enable local participation in the midstream and downstream activities which would follow, and in the development of priority national economic foundations.

Enabling locals to optimize exploitation of their natural heritage of the natural capital inherent in their natural gas prospects for investing in priority economic foundations of importance for Tanzanian generations should have been main basis on which the new natural gas policy of Tanzania should have been founded.

Development of natural gas policy which delivers such enabling of locals should consider that the seed capital foreign investors would contribute from own pockets in the enabling of Tanzania’s natural gas prospects attractiveness for further financing of global markets in their appraisal is such a paltry local investors could also equally share and just a mere fraction of the natural capital inherent in the prospects Tanzanians are contributing in their foreign involved generation and appraisal.

Such consideration would have justified majority local (State, workers and private sector joint venture) ownership of the natural capital extractable from any commercial natural gas find which would be made in the country by partnership with foreign investors.

State collaboration with private sector and workers (through their social security funds) is probably the optimal way of ensuring maximization of local contribution, participation and share of the natural capital extractable from any commercial natural gas find which would be made in the country,  as it enables  mitigation of the limitations of huge capital and risks involved in the appraisal of natural gas prospects, to maximize local participation. 

Local participation should be collective and spread in all appraisals happening in the country rather than concentrated on just few of them in order to maximize the probability of local success and benefit in all commercial natural gas finds made in the country. The probability of investment return is still high even if it is only one turns out commercial in all appraised natural gas activities going on in the country, when the probability of zero return for investments concentrated on just few targets is very high and too risky.

Again, the new Tanzania’s natural gas policy based on maximization of local participation in the midstream and downstream natural gas activities which would evolve from any whole foreign led commercial finds of natural gas in the country is impractical, focused on fault priorities and one which would enable very minimal contribution of what local natural gas sector should contribute in the development of private sector and Tanzania’s national economy.

It is impractical because its exclusion of local participation in the most rewarding upstream natural gas prospects generation and appraisal, has denied Tanzanians the opportunity to tap on the natural capital inherent in their nonrenewable natural gas resources for investing in priority economic foundations of importance to Tanzanian generations like in oil and natural gas prospects generation and appraisal elsewhere, in hydro, coal and nuclear power generation, and in agriculture, fisheries and manufacturing.

Also the Tanzania’s new natural gas policy is built on fault midstream and downstream priorities in the development of the Tanzanian economy because such prioritization would lure local investments and development of skills away from primary national priorities like in the generation and appraisal of natural gas prospects elsewhere, development of existing hydro, coal and nuclear power generation potentials, agriculture, fisheries and manufacturing into the unsustainable midstream and downstream investment opportunities which would evolve from the would be non renewable commercial natural gas finds made in the country.

Instead, it should have been Tanzania’s gas policy which is founded on the need to maximize local participation in any upstream natural gas prospect generation and appraisal activity which would happen in the country in partnership with foreign investors, which is practical and a must in ensuring maximization of local share in any commercial natural gas find which would be made in the country, as one of the main sources of the empowerment seed capital locals need in the development of their national economic foundations.

Maximization of local participation in any upstream activity in the generation of natural gas prospects and their appraisals is maximization of the local share of the extractable natural capital inherent in all commercial natural gas finds made in the country for investing in the development national economic foundations of importance to Tanzanian generations.

It enables local exploitation of the natural capital inherent in any commercial natural gas find made in the country in the form of profits realized from partial or whole sale of local shares in any commercial natural gas find made in the country and utilization of the same as collateral in loans mobilization for investing in priority national investments, from which seed capital regenerated could reach many times the natural capital extractable from the commercial natural gas find (s) used as source of seed capital in the development of priority national economic  foundations of importance to Tanzanian generations plus production share of profits and the taxes born from profits realized by foreign partners.

Maximization of the contribution of Tanzania’s natural gas industry in the development of economic foundations of importance to its generations should therefore base on a national natural gas policy founded on the need to maximize local participation in the most rewarding upstream natural gas prospects generation and appraisal in order to maximize its share of the natural capital extractable from any commercial natural gas find made in the country for investing in the development of  priority economic foundations of importance to Tanzanian generations.

 

Views: 287

Add a Comment

You need to be a member of GOXI to add comments!

Join GOXI

Conveners

           GOXI Partners

Videos

  • Add Videos
  • View All

© 2019   Created by Kobina Aidoo.   Powered by

Badges  |  Report an Issue  |  Terms of Service