This sample oil and gas exploration and production business plan can be used for grant applications, bank loans, proposal writing, business concept notes and as a roadmap to achieve your business objectives.

Also, you crucially need the guidance of a specialist petroleum industry consultant in Tanzania, such as Hussein Boffu, to help you in implementing this business plan.

Executive Summary

In recent years, due to economic recovery, Tanzania has registered significant growth in the demand for gas. Moreover, increased gas-to-power initiatives, increased industrialization and continued economic activities in the region require growth in gas-delivered volume for supporting economic expansion. Glass supply is so inadequate that current small gas-producing fields can’t cover the growth demand for all power consumers and industrial users. Moreover, the approach used to meet the increased gas demand elsewhere in the world is to encourage and attracting exploration and production companies through bidding around.

Rich Energy Exploration and Production Tanzania Limited is positioned to capitalize on these growing opportunities, that the Tanzanian oil and gas market hold, by playing vital roles in developing a new source of gas supply to ensure the availability of enough gas for power generation, industrial and households use.

The founding team has over 60 years’ experience in aspects of the energy industry including engineering, managerial, researching and marketing. The company will be established on 29th October 2020 to explore, develop and produce natural gas for industrial users and power stations in Tanzania.

Rich Energy Exploration and Production Tanzania Limited expects that approximately 40.4 billion in gas sales will be created annually.

Our vision

To facilitate industrial and commercial development, job creation, and economic growth through development of indigenous natural gas sector.

The mission

Our mission is to be the top performer in our industry in order to enhance the value of our shareholders. We will utilize the team work of our people and appropriate technology to provide our customers with high-quality products competitive in price.

Objectives

• To provide competitive total shareholders’ return in top 25 percent in the industry.
• Maintain our financial flexibility and consistently fund our capital program.
• Achieve and maintain the highest standards of safety, ethics, total quality and environmental performance in all operations.
• Improve competitive performance through a more effective utilization of technology.
• Build employee commitment and loyalty through communication and creation of opportunities.
• Satisfy customer requirement through continuous quality improvement.
• Operate our business in efficient, low cost, high quality manner, maintaining high standards of ethics, safety and environment compliance.

Key to Success

• Add commercial reserves by drilling at low cost reserves relative to competition.
• Produce oil and gas resources at high margin relative to the competition.
• Add commercial reserves by acquiring assets at low cost relative to the competition.

The Management

Chief Executive Officer: Adam Smith has over 30 years’ experience with specialized technical, operational and managerial abilities focused on critical aspect of the energy sector industry including engineering, operating, research and marketing abilities having worked at the managing director level with Shell, Equinor etc.

Financial Engineer: Chriss Mkema Innocent is a financial engineer with deep operating experience, great negotiation skills and a knack for numbers and deal-making.

Operation Manager: Abdallah Igengu is a reservoir and petroleum engineer with 32 years’ experience in the upstream oil and gas industry in different countries. He has a Bachelor of Science in Petroleum Engineering and an MBA from Madonna University, USA.

Legal Advisor: Anganile Anyeliswe.

Petroleum Consultant: Hussein Boffu

Board of Directors: Rich Energy Exploration and Production Tanzania Limited is controlled through its Board of Directors. The board will consist four members and comprises non-executive directors. The Board’s main roles are to create value for shareholders, to provide entrepreneurial leadership to the Group, to approve the Group’s strategic objectives and to ensure that the necessary financial and other resources are made available to enable the Group to meet its objectives.

Products and Services

Rich Energy Exploration and Production Tanzania Limited will be selling natural gas to industrial customers such as factories, hotels and power generation customers such power stations and government agencies including state-owned utility company, TANESCO, and state-owned national oil company, Tanzania Petroleum Development Corporation (TPDC).

Market Analysis

Tanzania is arguably the most exciting oil exploration region in the world. But it still is the most untapped region. As at the time of this writing, exploration activities confirmed reserves of 57.54 trillion cubic feet of natural gas in Tanzania, and more than 441 trillion cubic feet of natural gas are still trapped underground, solely in the coastal region, according to the US Geological Survey. So, discoveries might be forthcoming. This is why giants like Royal Dutch Shell, Equinor, Total and Pavilion Energy are buzzing around Tanzania like bees do to honey. The big boys won’t lift a finger if there’s no chance big profits could be made. Furthermore, with continued economic growth in Tanzania will come an increased gas demand. These signs indicate that the future for the oil and gas exploration activity is really bright.

Trends

There has been a change in the dynamic of oil and gas exploration and development in Tanzania, driven by the 2014-2016 oil price slump which reflects the global oil and gas industry downturn. The region has also seen takeovers and mergers amongst operating companies. Most noticeable of these were that Royal Dutch Shell acquired BG Group for US $50 million (the takeover gave Shell 60% of BG’s block 1 and block 4 offshore Tanzania in February 2016) and the Indonesian company, Medco Energi’s $539m acquisition of Ophir Energy in May 2019.

Competition

There have been significant onshore and offshore discoveries of gas in the last ten years and it is expected that the development of these discoveries will increase competition in the future.

Pan African Energy Tanzania (PAET), a subsidiary of Orca Exploration Group Inc. (“Orca”), operator of the Songo Songo gas field located in the southern part of Tanzania, has been producing gas in Tanzania since 2004.

Mnazi Bay field started producing gas in 2015 operated by Pertamina-owned Maurel & Prom partnered with Alberta-based Wentworth Resources and the state-owned oil company Tanzania Petroleum Development Corporation have a stake in the field.

Get the Complete Business Plan

Make a payment of US $200 through Tgo pesa, M-pesa to any of these numbers

1. +255768183677
2. +255655376543

Once your payment is done, send an SMS to +255768183677or +255655376543 with the following details:

• Your full name.
• Your email address.

Alternatively, send an email with the above details to info@tanzaniapetroleum.com The moment we receive your email or SMS, and we confirm your payment, the eBook will be delivered to your email address (in PDF format) within ten minutes. You can then download it and read it on your Smartphone or computer.

If you’re not in Tanzania, send an email to info@tanzaniapetroleum.com and we will devise a payment option for you.

  

 

he demand for retailing petroleum products – including diesel, petrol and kerosene – in rural areas and small towns in Tanzania is growing at a fast rate.

The growing demand of retail petrol stations in those areas is driven by increasing economic and farming activities.

The farmers constantly require diesel in huge quantities in order to operate their windmill to pump water for their livestock as well as crops, and to operate their tractors.

There is a proliferation of trucks that used to transport crops in rural areas that rely on diesel or petrol. The fishers constantly require fuel to power their fishing boats.

Furthermore, due to limited access to electricity, farmers install generators to operate their windmill to pump water for their crops or to power their homes. Also, locals in those areas rely on kerosene to light up their homes.

Most important is the emerging mode of transportation. There are tricycles – or boda-boda, as everyone calls it – and this has increased the demand for retail petrol stations in rural areas and small towns in Tanzania.

Currently, most rural areas and small towns have good vehicle traffic/volume but the surprising truth is that for decades fewer petrol stations have been set up there.

It is estimated that, in some small towns, locals, farmers and vehicle owners have to travel more than 100 kilometers to the nearby town’s petrol stations to get access to fuel.

But with new facilities, roads and factories being built in rural areas, setting up a petrol station over there can get you a high return on investment.

Related Project: A Sample Business Plan for Starting and Running A Petrol Station in Tanzania

In reality, there is a great demand of petrol station in rural areas and small towns. Even the Energy, Water and Utilities Regulatory Authority (EWURA) has lessened the requirements for starting petrol stations in rural areas to reduce investment cost, start-up capital and project cost.

The aim is to encourage investors to set up petrol stations and meet the huge demand of fuel in rural areas.

Retail Petrol Station Industry Outlook

Although competition has increased over the past few years, fuel sales continue to increase annually. The most intense competition is in larger urban centers, because most entrepreneurs are looking to have fuel stations in the city centers and more bustling urban parts of Tanzania. This leaves opportunity for independents in smaller rural settings and small towns.

So, setting up your small petrol station in up-country areas and small towns is a successful model for entrepreneurs looking to benefits from the fuel station business in Tanzania.

Introducing………………

A Detailed Feasibility and Project Report on Starting a Profitable Small Petrol Station with Two Pumps in the Rural Areas and Small Towns in Tanzania

Get the Full Version Now

In the full report you will learn the following:

• What is the structure of a small petrol station business?
• What is the petrol station industry size and growth?
• What is the outlook of petrol station industry?
• What are the licenses, permits and certification required for setting up small petrol stations in rural areas?
• What is the working capital required for setting small petrol station in Tanzania?
• What are the built-up requirements for small petrol stations in Tanzania?
• What is the total project cost for setting up a small petrol station business in Tanzania? (This includes the breakdown of such start-up capital and project cost for setting up petrol stations?)
• What are the items of equipment and machinery required for setting up a small petrol station business? And what are their prices and where can you buy them in Tanzania?
• What is the minimal size of land required for setting up a small petrol station with only two pumps?
• What is the profit margin and income for a small petrol station business?
• What are the requirements as regards utilities, electricity, water, salaries and overheads for setting up a petrol station business?
• What are SWOT analysis for setting up small scale petrol station in rural areas and small towns in Tanzania?
• What are the personnel (manpower) requirements for starting a small petrol station business?
• What are the market opportunities and market assessment for setting up a small petrol station business?
• What are the petrol station industry trends?
• Who are the suppliers of petroleum products/fuel, machines and equipment for setting up your small petrol station business?
• What are the projected balance sheet for petrol station business?
• What are the marketing strategies for small petrol stations in rural areas or small towns in Tanzania?
• Since a petrol station is prone to theft, how do you control theft in your business, so that you can see good returns on daily sales?
• What are the challenges associated with running a small petrol station business, and how to overcome them?
• What is the financial projection for small petrol stations?

 

For the complete report for setting up and running a petrol station business  in Tanzania, make a payment of $100 (or its equivalent in Tanzanian Shillings TZS 200,000) through Tgo pesa, M-pesa to this number: +255655376543.

Once your payment is done, send an SMS to +255768183677 or +255655376543 with the following details:

• Your full name.
• Your email address.

Alternatively, send an email with the above details to info@tanzaniapetroleum.com. The moment we receive your email or SMS and we confirm your payment, the report will be delivered to your email address (in PDF) within fifteen minutes.

You can then download it and read it on your smartphone or computer.

If you’re not in Tanzania, send an email to info@tanzaniapetroleum.com and we will devise a payment option for you.

If you’re brainstorming in order to find a perfect business idea in Tanzania, 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 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 have carried out solid research.

So, I can confidently tell you that this is one of the right business opportunities to pursue.

Tanzania is expected to consume around 112,400 barrels per day (b/d) of refined fuel by 2025. This means that no matter how much petroleum
products are imported, still, extra will be needed to support the day-to-day economic activities in the country.

It  seems that there is high  entry barriers as the new entrants will have to invest  heavily in the initials capital requirements.

 But with proper, Petrol station business plan, you can get a loan from  bank  to start this business  and you will be able to pay back the money and the interest in about 8 months. 

Banks and investors are aware of the potential of petrol station business in emerging country like Tanzania and hence are willing to give out loans.

Now let’s see the profit margin of a petrol station business. It is very hard to determine how much you can make from the petrol station, because it depends on the following factors:

 Location: The location of a station is incredibly important to ensure the success of this businesses.A petrol station located in a high traffic area earns more income than if located in a low traffic region.

 Oil prices: Location is crucial for Profit margin tends to increase when oil price moves lower. Of course, the opposite can be true.

 Number of employees: The number of employees affect profit margin, too. And it differs from one petrol station to the other.

 Supplier: It depends on the supplier whom you source fuel from. Some suppliers leave a room for negotiating competitive prices.

 Products and services you offer: A petrol station that depends on income solely from fuel will earn little money than the one offering a variety of goods, such as fast foods, etc.

But an average petrol station’s sales is about 5,000 to 25,000 liters per day, based on the factor above, but the profit margin made by petrol station is TZS 100 to  TZS 310 a liter.

So, if you sell 5000 liters a day will make you TZS 100 × 5000 = TZS 500,000. In a month, you will have a profit margin of TZS 30 × 500,000 = TZS 15,000,000. That figure can vary widely, depending on where petrol station is located. For example, the petrol stations that are placed in high traffic areas have an average fuel sales of more than 25,000 liters a day. So for that rates, the profit margin per day will be TZS 100 × 25,000 = TZS 2,500,000 Again, in a month, that will make you 30 × TZS 2,500,000 = TZS 75,000,000. So, this is why petrol stations are on every street corner, because they make good money. So, everyone wants to jump into this business.

I hope this helps.

The pipeline project that will pump crude oil from Uganda Oil wells to Tanga port in Tanzania is on everyone ‘s radar. This is because of the vast opportunities the project create across the different sector of the economy.

It’s widely known that from the pre-construction through operation or the finishing phase, opportunities abound for different sets of businesses. Both local and foreign businesses in Tanzania and Uganda Economy. 

The project will demand different kinds of works and will provide different kinds of opportunities at different times or phases.

How do you tap into the opportunities? Do you just sit back and hope you get called to participate? Or you start knocking on office doors of oil and gas companies’ managers and hope they have a stake in the EACOP project?

That is why I am here.

Technically speaking, building the East African crude oil pipeline will require highly specialized skills, technology, and expertise. Much of this is not within its immediate capacity, with virtually little experience in oil and gas.

To be perfectly honest, these are capacities East Africa will instead have to build over time. It is encouraging that even early plans of the project management were seeking to incorporate training and development.

Despite the current limitation, opportunities are immense for local businesses to participate in the commercial aspects of the pipeline projects. And play an immediate role in supporting the oil and gas sector.

Opportunities for local businesses in the projects range from providing goods and supportive services to training and development facilitation as well as conference and industry events coordination.

Tapping into the EACOP project opportunities will require quick thinking, careful planning, and strategic action.

Local businesses looking to participates in this project should evaluate their capabilities, services, or products to identify how these can be modified or the best fist in the pipeline projects.

Also, local businesses should interact with operators, understand their needs, and embrace partnership opportunities with active oil and gas companies in Tanzania and Uganda.

This partnership is a good entry in the sector, To become successful they should make sure that their services and capabilities are meeting with international safety and standards
On the other hand, The project has attracted interest in many foreign service companies.

Leveraging their expertise and experience foreign companies are crucial for boosting local content in the oil and gas projects in Tanzania and East Africa.

Going alone is not the best option for foreign service companies looking to play an immediate and significant role in this project.

Forming a joint venture with a local partner is the best local market access. The foreign firms will get an entry in the local market and local business will learn the rope of the industry with no time if they want to benefits knowledge, expertise and technology transfer from the international firms
Before looking for this partnership, foreign businesses should study the market needs.

They should identify the projects’ and clients’ requirements and ongoing market forces and competition landscape. They should define what is the best entry strategy? They can research the market on their own or by retaining the service of consultants.

It is not enough to understand opportunities abounding the projects. To win works foreign and local businesses should understand the specific clients’ requirements, gather project data. You should understand regulation impacting the local industry.

With pipeline project expected to start on March 2021, both local and international businesses have short time to master it . But collaboration will be vital for their success.

Following an evaluation of the exploration potential of the blocks and an assessment of the report of the pre-feasibility phase of the Environmental Impact Assessment (EIA), Sasol has decided to relinquish its exploration license in Blocks 16 & 19 offshore Mozambique.

Sasol was awarded Blocks 16 & 19 in June 2005. Since that time, the comapany conducted deep-water exploration activities in the license areas in a safe and environmentally responsible manner.
With the relinquishment of the deep-water part of the license on 1 July 2013, the shallow water area of the license was retained with a view to define a future work programme to assess the remaining hydrocarbon potential.

Understanding and appreciating the environmental sensitivity of the area, Sasol undertook a robust and transparent pre-feasibility assessment through Golder & Associates, an independent, reputable environmental specialist consulting firm, prior to any exploration activity. This process involved consultation with all relevant stakeholders, from government, on all levels, industry, such as tourism and fisheries, to academia.
Sasol acknowledges all the comments received during the pre-feasibility phase of the EIA process and values the input that all stakeholders contributed.

Sasol will relinquish Blocks 16 & 19 in their entirety to the Government of Mozambique. A withdrawal notification has been issued to the relevant Mozambican authorities.
Sustainability is integral to how Sasol conducts business, which is underpinned by our commitment to compliance with all environmental legislation and undertaking any exploration activity in an environmentally responsible manner.

Sasol is an international integrated chemicals and energy company that leverages technologies and the expertise of our 31 270 people working in 31 countries. We develop and commercialise technologies, and build and operate world-scale facilities to produce a range of high-value product stream, including liquid fuels, chemicals and low-carbon electricity. Sasol was established in 1950 in South Africa and we remain one of the country’s largest investors in capital projects, skills development and technological research and development. The company is listed on the JSE in South Africa and on the New York Stock Exchange in the United States.
(Source: Sasol)