THE UNITED Republic of Tanzania plans to spend about US$6 million to buy land for the planned construction of a liquefied natural gas plant.
The project estimated at US$30 billion, has run into delays mainly due to complex land acquisition procedures and an uncertain legal and regulatory framework.
Along with neighbouring Mozambique, the country plans to build the plant with the main aim of exploiting the global gas demand and supply gap that is expected to increase by 2020.
“The government has set aside 12 billion shillings (about US$6 million) in 2015/16 for assessment and compensation of 450 people…where the plant will be built,” the government's planning commission said in a report. The 2015/16 fiscal year starts on 1 July 2015.
The plant would be built in the small southern town of Lindi, located close to an offshore deep-sea region where huge natural gas discoveries have been made.
Tanzania is estimated to have more than 53.2 trillion cubic feet (tcf) of gas reserves off its southern coast but its energy sector has long been challenged by allegations of graft and other problems.