Tanzania’s oil and gas(energy) sector is a continuously changing market. These changes can create opportunities for your business or threaten the performance of your business.

Here are changes that have occurred in the oil and gas(energy) sector in Tanzania and East Africa

1.Increased competition.

As the energy industry grows in Tanzania and East Africa and competition increases, more and more people are finding the industry lucrative and are jumping on it. So the perceived differences between you and your best competitor decrease. 

You are probably feeling increasingly commoditized as clients and consumers view you and your competitors as pretty much the same.

 If you don’t have a dynamic and robust network of support and experts around you, your winning rate may be decreasing. Reduce your margin. And limit your cash on hand.

2.Increased regulations:

Today, the oil and gas industry is confronted by a tidal wave of environmental, health, safety, and local content regulations. The effect of these regulations is to impose demanding new responsibilities on businesses not prepared or qualified to handle them. Failure to comply with these requirements may result in severe penalties or costly litigation. So environmental, safety and local content compliance is a key to having a successful operation of your energy project and company in the region. 

3.The demand for fuel is going up.

The number of people in Tanzania and East Africa is rising. 

Industrial activity is also expanding. There will be a huge demand for fuel to power our economies and industries. There numerous investment opportunities to build new oil and gas facilities, that could add up to the fuel supply in Tanzania.

 

4.Downstream holds key opportunities:  

With rising demand for fuel in Tanzania and East Africa, the downstream petroleum marketing sector creates massive value for the economy, but the opportunities are yet to be fully explored.  

 There are enormous opportunities for further investment to increase the adoption of liquefied petroleum gas(LPG) and other wide-range petroleum products across the region.

Furthermore, The sector offers sustainable business opportunities ranging from starting petrol stations marketing liquefied petroleum gas(LPG) and lubricant oils. The good news is that the entry barrier for entrepreneurs to partake in the sector is relatively lower than in the Upstream(exploration and production) sub-sector of the oil and gas industry.

5.Huge Upstream energy projects are coming online as expected:

It’s amazing to watch how quickly the government is working with the large super majors in joint ventures into the liquefied natural gas(LNG) projects because they know it is prosperous for its people.

They know that for the country to continue its progress in medicine, social responsibility, science, education, and general quality of life, it must ensure an increasing supply of abundant, reliable, and affordable energy. So LNG project means more economic opportunities for companies, local businesses and the community.

 

6.Increased pressure from Energy Transition enthusiasts.

There is a clamor by developed countries to reduce carbon emissions and curb global warming by ending fossil fuels.

This rush to move away from fossil fuels has caused certain international commercial banks to refuse to fund the development of the oil and gas projects and shift the budget to renewable energy projects like solar and wind. So if you are oil and gas  operators you can join the world in dealing with climate change by paying to plant new trees and running renewable energy projects.

Hussein Boffu is the most reliable local management consultant in the oil and gas(energy)industry. He strive to help African enterprises in the energy sector make a better future, thereby creating good jobs for young Tanzanians and Africans. He envision a vibrant economy with equally competitive African enterprises as their foreign counterparts. He can be reached via Hussein.Boffu@Tanzaniapetroleum.com or Text/Call/WhatsApp +255(0)655376543