40+ Profitable Business Opportunities In Oil and Gas In Tanzania and Africa

The oil and gas sector has opened up opportunities for big and small players, giving a fairground for those who want to be entrepreneurs in this sector.

The petroleum sector in Tanzania and East Africa is creating wealth for their investors.

But it breaks my heart to say that our people (Tanzanians and Africans) are still at the backbench because of the lack of information. Tanzanians entrepreneurs are brilliant. But we are playing small in the oil and gas industry.

The simple truth is that our local economy could be changed for much better by our greater industry participation.

Why did we wait till now when others had taken the juicy areas in the industry? It’s not too late.

While opportunities in the industry might sound capital intensive, there are lucrative small-scale investment opportunities in the oil and gas industry.

No matter the size of your pocket, if you look critically, you will still discover small scale business opportunities you can pursue

1. LPG(cooking gas wholesale)Distribution

Eligible entrepreneurs can apply to become a significant oil marketing company’s super dealer who will work partly with them to sell the LPG, cookers, Fittings, and site installation in your target region.

Your supplier(large oil marketing company) will supply you full gas cylinders in bulk at a fair wholesale price, and in turn, you will sell and earn a modest profit margin, and you may decide to sell at retail price to double profit.

As a super dealer, you will have to make sure that you have enough gas cylinder stock at any point to meet the orders of your clients instantly. You will also have at least one supply carrier to ensure adequate supply. The initial capital investment for this venture ranges from Tsh 35,000,000 to Tsh 60,000,000

2. Set up small scale fuel filling station with two pumps in rural in rural areas

Not every corner of Tanzania wants to go to the petrol station and eat or buy some groceries. There is the time when you go to the petrol station you wish to your services. So if you are searching for business opportunities, starting a small petrol station can be the best choice.

Furthermore, your petrol station is not necessarily in the city like Dar es salaam or Mwanzania. You can start a small fuel station in the rural areas. Major oil brands that prefer urban areas. So they always neglect these rural areas. Having your small petrol station in the rural areas is far less expensive to set up and maintain and still guarantees a sustainable profit.

3.Become Agent.

As an agent you act as intemidi you bring vendors and operating or oil and gas company together. As agents your role is to get orders and usually earn commission from your services.

For the most part, agents work for vendors or suppliers. For example, you may know oil and gas companies in Tanzania looking to buy certain types of products or services. You might identify suppliers or vendors of the products and services overseas and represent them to oil and gas clients in Tanzania.

If you are working as agent, you run the risk that after you set up that initial contact, the seller( vendors or suppliers) may go right past you and deal directly with the buyer(multinational oil and gas company)

4.Cooking Gas Reseller Shop

Liquefied petroleum gas (LPG) market (popularly known as cooking gas) is expected to grow by fifty percent shortly due to the wide adoption of LPG as a source of energy for cooking in residential areas, replacing other traditional cooking fuel such as charcoal and firewood.

The first option to go into the LP Gas business is to set up a retail shop in highbrow areas. Location is a crucial driver to success in starting a cooking gas reseller shop. To start this LP gas business, you need at least 22 to 35 pieces of gas cylinders (preferably 15Kg and 6Kg gas cylinder), regulators and hose, and a weighing scale. You will buy the cooking gas from primary dealers/super dealers and resell it to your target location’s households.

I often wonder how they make a profit seeing that there is intense competition in this business. But the best part is that, as the number of households switching to this fuel increases, demand increases, and more customers arise.

5./Products(Fuel) and Logistics

Due to the increasing demand for petroleum products in East African countries, transportation of these products (for example, premium motor spirit (PMS), diesel, kerosene, and other petroleum products) has opened a lucrative investment opportunity for entrepreneurs. This business is about using fuel tankers (trucks) to distribute petroleum products with transport charges depending on the distance to be covered and the truck’s capacity.

You will have to obtain a license from EWURA to be allowed to transport fuel across the country or to neighboring countries. You will have to purchase a truck and hire a qualified and experienced driver who will haul petroleum products to their desired destination for marketers from the depot.

I would recommend you start with transporting petroleum products from depots to filling stations locally across the country. As your business expands, you can acquire a new license to transit fuel to neighboring Uganda, Kenya, Rwanda, and Congo DRC.

6. Maintenance and servicing 

This is another profitable venture because oil and gas companies have many facilities, including depots, gas plants, tank farms, power plans, gas wells. So, they will always need to fix and maintain them.

And that is where you come in. However, most importantly, you need sufficient technical knowledge and assemble a strong team of service engineers and technicians to satisfy your clients fully.

 

7.Establishment of Gas Cylinder Manufacturing Plant:

It will interest you to know that Tanzania imports the LP Gas cylinders from India. So, there is no functional LP Gas cylinder manufacturing facility in Tanzania, and this presents immense opportunities for aspiring entrepreneurs with a sizable amount of capital to set up gas cylinder manufacturing plants in Tanzania.

8.Consulting

While many consulting firms in Tanzania and East Africa focus on engineering and project consulting, there is a gap in the market that needs guidance, support, and resources for the investors who own or want to start a business in this industry.

So, you fill this gap by starting your consulting firm and providing business support for people who want to build a sustainable business in the oil and gas industry. This business is ideal for people who don’t have huge capital to venture into an expensive oil and gas business but have in-depth knowledge of the oil and gas industry.

 

9.LPG Gas Storage Plant:

 This is a lucrative investment opportunity in Tanzania’s LPG value chain. This kind of investment has multiple sources of income. As a large LP Gas marketer, you import, store and sell LP Gas to super dealers, gas refilling station owners, and you can also sell in bulk to commercial customers like hotels, lodges, schools, and colleges. Furthermore, you can earn additional income by offering installation services of bulk tanks and pipeline networks to schools and hotels that need to use LP Gas for cooking.

The initial capital requirement for this storage terminal is huge: it will require not less than TZS 1.5 billion. However, the business is more profitable as you’d sell the LPG in bulk.

10.Go into the Retailing and Supplying of pumping Machines.

If you have visited a gas station/filling station before, you will notice that the means of retailing fuel, diesel, gas, and kerosene et al. is via a well-calibrated pumping machine. This goes to show that there is a market for pumping machines.

 

11. LPG Re-filling Plant/Center: 

I’d recommend this to anyone with financial muscle. As a refilling center, you will purchase bulk LP Gas and sell it to distributors and consumers. It’s capital intensive and the total project cost for setting up a refilling center in Tanzania is TZS 250 million to TZS 300 million.

12.Host Industry Events and Conferences

Suppose you don’t have the massive capital to venture into those expensive oil and gas businesses, but you have passion for the oil and gas industry. In that case, you may consider putting together industry events, helping professionals and companies learn about new development across the industry, and building valuable relationships for career and business development.

If your event can attract relevant decision-makers in the industry, you will make handsome money from attendees and sponsorship from companies looking for visibility and exposure across the oil and gas industry.

 

13.Start a Petrol Station

If you’re brainstorming in order to find a perfect business idea in Tanzania and East African oil and gas sector, investing your cash in the petrol filling station business is a wise decision.
This business ensures steady profit in a reasonable time from setting up. You might feel the market is already flooded, but you can come in and have a go at it. Petrol stations are in every street corner because they make insane profit.

Don’t get me wrong. I am not saying this to brag. Instead, I am telling you this because I’ve carried out solid research. So, I can confidently tell you that this is one of the right business opportunities to pursue.

The filling station market emerged in tandem with the automobile industry.
Most important is the emerging mode of transportation. There are tricycles or “boda-boda,” as everyone calls it, and it has increased the demand for petroleum products in Tanzania. The good news is that, all these vehicles and generators run on diesels or petrol.

With petrol station in every street corner, you might feel the market is already saturated. But with a good location, commercial expertise, systematic marketing and a wide range of services, new entrepreneurs like you can win the competition in this business.

14 Setting your own lubricant blending/Manufacturing Plant

The demand for lubricant oil such as blended motor oil, brake fluids lubricating greases, and other oil-based additives is huge in Tanzania. There are only six lube oil plants in the country that are insufficient to meet the existing demand for lubricating engine oil in Tanzania. Even the energy regulatory agency argue investors to set up more lube oil plants to minimize the importation of substandard engine oil into the region

 

 15.Cooking Gas Products and Accessories

Offering LPGas products and accessories like cookers and fitting is another lucrative business opportunity in Tanzania.

16. Start a Filling Station Construction/Building Company

Another lucrative business in the oil and gas business value chain that an entrepreneur should consider starting is a filling station construction/building company. It is essential to state that you can only successfully start this type of business if you have the required training, experience, and technical skills. Investors are investing in the filling station business, so contractors will always have a market to construct filling stations.

17.Go into the Retailing and Supplying of pumping Machines

If you have visited a gas station/filling station before, you will notice that the means of retailing fuel, diesel, gas, and kerosene et al. is via a well-calibrated pumping machine. This goes to show that there is a market for pumping machines.

18. Health and Safety Training for Oil and Gas Workers 

Another thriving and profitable business in the value chain is health and safety training for oil and gas workers. If you have the necessary background (experience and qualifications) to train on health and safety, you should consider starting an organization that trains oil and gas personnel. Health and safety are taken seriously in the oil and gas industry simply because of the risk and hazards that workers are subjected to carrying out their jobs.

19. Manufacturing and Sale of Oil and Gas Equipment and Tools

Manufacturing and selling oil and gas machines and equipment is yet another thriving and profitable oil and gas-related business that an investor looking towards starting a business in the industry should consider. Oil drilling and exploration equipment, pumping machines, casing, and pipe stacking and handling equipment, pumps, slush, oil and gas rig, gauges and meters, valves, actuators, regulators, cranes, and lifting equipment, hazardous area electrical equipment, and several other equipment and machines are marketable. So, if you are looking for a business to start in the oil and gas industry, then one of your options is to go into manufacturing and selling oil and gas machines and equipment.

20. Welding Services for oil and gas companies

Another profitable and thriving business in the oil and gas industry that an entrepreneur looking towards starting a business in the industry can successfully begin to after acquiring the required training is to offer welding services. Welding is one of the services needed in the oil and gas industry to deliver precision welding jobs. So, if you are looking for a business to start in the oil and gas industry, then one of your options is to provide welding services for oil and gas companies.

21. Go Oil farm/Depot Storage Services

Imported fuel, as stated above, is stored in tank farms. Most oil marketers don’t own tank farms and, as a result, always need to keep their petroleum products in other tank farms. With a sizeable operating capital, you can construct a tank farm for the sole purpose of leasing it out to oil marketers who bring in petroleum products.

22. Open a Training School/Institution

There are very few colleges and universities that offer specialized training in the oil and gas sector. Starting an institute focused on the oil and gas industry is a good idea. Choose a niche, hire trained instructors, lease property and provide a robust curriculum.

23. Go Sell Equipment

The oil and gas industry uses lots of machinery to carry out its activities. You can buy or fabricate equipment targeted at a sector. The business is lucrative and requires lots of investment in money, technical knowledge, and testing.

24. Retail Kerosene

Kerosene’s business is profitable and has a vast market. People use kerosene for cooking meals and light fires.

25. Oil and Gas Enterprise Software Application

Technology companies are equally not left out as they can build tech solutions specifically targeting the oil and gas industry and license the software to companies in the sector.

    26.Start a Crude Oil Refinery.

Tanzania imports millions of tons of refined petroleum products annually. By building a crude oil refinery using limited stock feed supply in Tanzania, you will reduce the number of petroleum products imported and cater to the booming consumer demand by providing Tanzanians with affordable petrol, diesel, jet fuel, and other petroleum products.

Setting up a crude oil refinery requires vast startup capital, but it is very profitable to pull up resources to start this business.

27.Build a Website

The website should focus on the oil and gas industry. Do reviews, interviews and write original content. Monetize your traffic through advertisements, referrals, and affiliate programs

28. Oil and Gas News

You can make money sharing news and information on latest developments, investment ideas, petroleum business challenges, entrepreneur interviews, etc. through online and offline means such as blogging, publishing periodic magazines, creating an oil and gas job portal, starting TV shows targeting the oil and gas sector and lots more. This is a perfect online oil and gas business for everyone.

29.Oil and Gas Brokerage Services

Even if you have no money to venture into the oil and gas business, you can still profit from the industry by offering brokerage services between buyers and sellers of petroleum products.

29. Start Oil and Gas TV Show

You can also launch a TV show targeting the oil and gas sector. You can profile and interview entrepreneurs in the oil sector, review the challenges in the petroleum sector, etc

30. Blogging on Oil and Gas-Related Issues

Another easy-to-start business in the oil and gas value chain is blogging on oil and gas-related issues. It is interesting to note that there are loads of people out there making millions annually from blogging. If you are an oil and gas professional or someone who has sound knowledge in the oil and gas industry, one of the businesses you can consider starting is blogging on oil and gas-related subjects. The truth is that if your blog has useful and helpful content, you will attract loads of traffic, and if you have loads of traffic on your blog, you can quickly secure good advertising deals from stakeholders and other businesses in your blog. Just ensure that you update your blog regularly, and you will continue to attract traffic.

31.Publication of oil and gas magazine

Another of the several businesses is to start publishing oil and gas magazines. Information is key in any industry, and all you need to do to gain ground with this type of business is to ensure that you have relevant content in your magazine per time. Part of the information that you should make available in your oil and gas magazine are the various business opportunities in the oil and gas industry, the latest trends, news, and information as it relates to the industry and advisory services to investors who are looking towards investing in the oil and gas industry.

 

32.Lubricant(Engine Oil) Retail Shop

Selling engine oil, brake fluid, and hydraulic oil et al. is a profitable and highly thriving business venture an entrepreneur interested in making money from the oil and gas business value chain should consider. Vehicle owners subject their vehicles to servicing at regular intervals creates a market for lubrication oil products. In recent times, there has been an increase in the lubrication oil production sector as it is one business you can readily go into with the hope of making a significant profit. The various needs of lube oils in homes, organizations, factories, and industries cannot be overemphasized because the population of mechanical requirements for oil has continued to increase over the years. So, to start in this trade, have an expert carry out good feasibility studies.

33.Start NDT and inspection company

Repairs on any project are very costly and, therefore, should be avoided or minimized.

As the inspection partner of the client, your job is to ensure the job is done right the first time and thereforesaving the client on repair expenditure.

The domain of quality control is enormous in Tanzania. By setting up your own inspection, you will be serving a wide range of clients in the construction and engineering industry like oil and gas, Petro-Chemical and Refineries, Paper & Pulp, Ship Repairs, Pipeline Construction, Mining Plant Construction, Power Generations, etc.

34 . Go into Sourcing and supplying qualified human resources.

Finding qualified and experienced employees is hard in Tanzania and East Africa’s oil and gas industry. With lucrative construction and engineering project coming online in the region, there would be a huge demand for qualified people to implement the projects. So venturing into these opportunities can be a wise decision.

35. Start training and development company

The discoveries of massive natural gas in Tanzania and the resulting investments in infrastructure such as ports, oil and gas pipelines, and renewable energy projects have created a significant demand for local workers in Tanzania. The sad reality is that operating companies find it difficult to attract highly qualified local people to implement the projects in the region. Starting a workforce development company to fully satisfy the needs for highly skilled workers by developing workers and moving them from just the local level to world-class professionals and industry leaders can be a lucrative venture to pursue.

36.Welding Services for oil and gas companies

Another profitable and thriving business in the oil and gas industry that an entrepreneur looking towards starting a business in the industry can successfully begin to after acquiring the required training is to offer welding services. Welding is one of the services needed in the oil and gas industry to deliver precision welding jobs. So, if you are looking for a business to start in the oil and gas industry, then one of your options is to provide welding services for oil and gas companies.

 

37. Go Oil farm/Depot Storage Services

Imported fuel, as stated above, is stored in tank farms. Most oil marketers don’t own tank farms and, as a result, always need to keep their petroleum products in other tank farms. With a sizeable operating capital, you can construct a tank farm for the sole purpose of leasing it out to oil marketers who bring in petroleum products.

38. Open a Training School/Institution

There are very few colleges and universities that offer specialized training in the oil and gas sector. Starting an institute focused on the oil and gas industry is a good idea. Choose a niche, hire trained instructors, lease property and provide a robust curriculum

39. Go Sell Equipment

The oil and gas industry uses lots of machinery to carry out its activities. You can buy or fabricate equipment targeted at a sector. The business is lucrative and requires lots of investment in money, technical knowledge, and testing.

40.Supply Personal Protective Equipment

The demand for personal protective equipment in the oil and gas industry is immense. You can build a name across the industry as a reliable supplier of overalls, gloves, safety boots etc

So, what are you waiting for?

If you feel interested in exploiting opportunities in the petroleum industry, start working on your idea right away. There is a price to pay from thinking about something too long and missing an opportunity. Let’s not make such a mistake again. Let’s not miss these opportunities. To make sure you will be able to take advantage of these opportunities, can we discuss your project idea today?