A “bankable” feasibility study means an institutional investor or development finance institution (DFI) can read it and confidently write a check. In Tanzania’s LPG market, investors screen for very specific criteria.
Secured Off-Take and Market Demand.
The first key area is secured off take and market demand. Investors do not care about theoretical demand. They want to see a clear path to monetization. Your study must prove who will buy the gas. This can be through B2B contracts with industrial clients or a strong retail distribution network strategy. For example, cylinder exchange models in fast growing hubs like Dar es Salaam, Dodoma, and Mwanza are often reviewed carefully. Investors want clear evidence that customers already exist or will reliably shift to your supply. Without this, the project is seen as uncertain.
Regulatory and Environmental Compliance.
The second area is regulatory and environmental compliance. LPG projects cannot move forward without approvals. Investors expect a clear and costed roadmap for securing EWURA licenses, National Environment Management Council clearance, and local government permits. This is not just paperwork. It is a key part of risk control. If permits are delayed or not secured, the project can stop completely. A strong feasibility study shows every approval step and the time needed for each process. It also shows the cost involved in compliance. Investors see this as part of project readiness.
Supply Chain Resilience.
The third area is supply chain resilience. Tanzania relies heavily on imported LPG. This creates exposure to external risks. Investors look closely at how the project handles supply chain shocks, demurrage costs at the Port of Dar es Salaam, and relationships with bulk procurement entities. They want to know if supply will remain stable during port delays, price changes, or shipping disruptions. A strong study explains where the LPG will come from, how it will be transported, and how storage will be managed. It should also explain backup supply options. Without supply security, even a strong market demand project becomes risky.
Realistic Financial Metrics.
Realistic financial metrics are also very important. Investors expect conservative, stress tested projections. They do not accept overly optimistic numbers. The feasibility study must show a healthy Internal Rate of Return. It must also show a realistic Payback Period. Most importantly, it must show a strong Debt Service Coverage Ratio.
In many cases, investors expect a DSCR above 1.3x. This means the project generates enough cash flow to comfortably repay its loans even under pressure. If the DSCR is weak, the project is considered high risk.
Investors also check whether the financial model is consistent with real market conditions. They want to see if costs are properly estimated and if revenue assumptions are supported by actual demand data. If the numbers feel unrealistic, trust is reduced.
In conclusion, investors look for clarity, realism, and risk control. A bankable LPG feasibility study is not about making the project look attractive. It is about proving that the project can survive real conditions and still repay financing. When these criteria are met, investors feel confident to approve funding and move forward with the project.
