Over the past few years, the compressed natural gas (CNG) market in Sub-Saharan Africa, particularly in Tanzania and Nigeria, has been witnessing significant growth. With the global energy sector shifting towards cleaner and more sustainable fuels, CNG has emerged as a pivotal player in addressing the region’s energy and environmental challenges.

This article delves into the latest developments, highlighting key projects, policy advancements, and the broader implications for executives, operations managers, and senior professionals working in CNG companies.

Why CNG? The Push for Cleaner Energy.

Natural gas, as one of the cleanest-burning fossil fuels, offers significant environmental benefits over traditional energy sources like coal and oil. Compressed Natural Gas (CNG) takes this a step further, offering a cost-effective and eco-friendly solution for transportation, power generation, and industrial applications.

• Lower Emissions: CNG produces significantly less carbon dioxide, sulfur dioxide, and particulate matter compared to diesel and gasoline.
• Cost Efficiency: CNG is cheaper than conventional fuels, providing an attractive option for businesses and consumers.
• Energy Security: Both Tanzania and Nigeria possess abundant natural gas reserves, making CNG a logical choice for domestic energy diversification.

Tanzania: Pioneering CNG Adoption in East Africa.

Tanzania’s natural gas reserves, estimated at over 57 trillion cubic feet (tcf), have become the cornerstone of the nation’s energy strategy. The government’s commitment to utilizing domestic resources efficiently has propelled the adoption of CNG, particularly in urban transportation and industrial applications.

Key Projects Driving CNG Expansion,

Nigeria: Africa’s Natural Gas Powerhouse.

With proven country’s vast natural gas reserves of 208.83  trillion cubic feet (TCF) as of 2023,Nigeria holds the largest gas reserves in Africa. While the country is traditionally associated with LNG exports, the domestic CNG market is experiencing a renaissance driven by government policies and private sector investments.

Major CNG Projects in Nigeria.

1. National Gas Expansion Program (NGEP):
   Launched by the Nigerian government, the NGEP aims to deepen domestic gas utilization, with CNG as a critical component.
   • Progress: Over 200 CNG refueling stations are planned across the country, with a focus on high-demand regions such as Lagos, Abuja, and Port Harcourt.
   • Fleet Conversion: The program targets converting 1 million vehicles to CNG by 2030, reducing dependence on petrol and diesel.
2. Private Sector Participation:
   Companies like NIPCO Gas and Green Energy International are leading the charge in developing CNG refueling infrastructure. Their efforts have catalyzed the adoption of CNG-powered buses and trucks, particularly in logistics and public transportation.

Addressing Challenges.

Opportunities for Business Performance.

Optimizing Site Selection.

Executives and operations managers should leverage data-driven methodologies to identify high-demand locations for CNG stations. Factors such as traffic patterns, industrial density, and proximity to natural gas pipelines can significantly influence project success.

Adopting Advanced Technology.

The integration of digital solutions, such as IoT-enabled sensors and predictive analytics, can enhance operational efficiency. These tools enable real-time monitoring of gas flow, storage levels, and equipment performance, reducing downtime and maintenance costs.

Building Strategic Partnerships.

Collaboration with stakeholders, including government agencies, technology providers, and financial institutions, is crucial for scaling CNG projects. Public-private partnerships (PPPs) have proven successful in accelerating infrastructure development and ensuring long-term viability.

The Road Ahead: CNG’s Role in a Sustainable Future.

Both Tanzania and Nigeria are positioning themselves as leaders in CNG adoption within Sub-Saharan Africa. The economic and environmental benefits of CNG make it a compelling alternative to conventional fuels, aligning with global energy transition goals.

For Tanzania.

The focus on urban transportation and industrial applications is setting a precedent for other East African nations. Continued investment in infrastructure and policy support will be key to maintaining this momentum.

For Nigeria.

With its vast gas reserves, Nigeria has the potential to become a regional hub for CNG production and distribution. Addressing infrastructure bottlenecks and fostering innovation will unlock new opportunities for growth.

Conclusion.

The rise of CNG projects in Tanzania and Nigeria underscores the growing importance of natural gas in Africa’s energy landscape. As executives, operations managers, and senior professionals navigate this evolving market, a strategic focus on technology, partnerships, and data-driven decision-making will be essential for driving business performance.

By Dr. Mohamed Mahgoub,

Dr. Mohamed Mahgoub

As Tanzania’s oil and gas sector emerges as a key player in East Africa’s energy landscape, technological advancements are playing a transformative role in unlocking the country’s vast energy potential.

With abundant natural resources waiting to be fully explored and developed, the effective application of new technologies is crucial for overcoming the region’s unique challenges.

This is especially true in Tanzania, where complex logistical, environmental, and infrastructure hurdles often pose significant barriers to exploration and production.

The introduction and integration of cutting-edge technologies in exploration, production, and resource management are proving to be the cornerstone for realizing the full economic promise of Tanzania’s oil and gas industry.

From advanced geophysical techniques to digital transformation through the Internet of Things (IoT), Tanzania’s oil and gas operators are leveraging the best the industry has to offer to enhance performance, improve efficiency, and ensure long-term sustainability.

Driving Precision with Advanced Geophysical Technologies.

One of the most significant innovations in oil and gas exploration in Tanzania is the advancement of geophysical technologies. These innovations are key to improving accuracy in locating and assessing oil and gas reserves beneath Tanzania’s surface.

Advanced seismic exploration methods, such as Ocean Bottom Node (OBN) surveys and 4D seismic monitoring, are allowing operators to gather highly detailed data on subsurface formations, improving the precision of their exploration efforts.

3D OBN seismic surveys, which have already become a game-changer in other regions, are now being deployed in Tanzania’s offshore exploration blocks. These high-resolution seismic techniques create detailed images of subsurface structures, allowing operators to identify the most promising drilling sites while minimizing the risk of dry wells.

The ongoing monitoring of reservoirs over time with 4D seismic data enhances operators’ understanding of reservoir behavior, enabling them to manage fields more efficiently and extend their productive life.

This increased accuracy is not only reducing operational costs but also increasing the likelihood of successful exploration and production, significantly boosting confidence in Tanzania’s untapped potential.

Revolutionizing Production with Horizontal Drilling and Hydraulic Fracturing.

Traditionally, oil and gas reserves have been accessed through vertical drilling, which limits the amount of hydrocarbon-bearing rock operators can reach. However, advances in horizontal drilling technology, paired with hydraulic fracturing techniques, are allowing operators to unlock new sources of oil and gas from unconventional reserves previously deemed too costly to extract.

Horizontal drilling allows operators to drill laterally through a reservoir, significantly increasing contact with the oil or gas reservoir, thus maximizing production rates. Hydraulic fracturing, also known as fracking, creates fractures in the rock formation, releasing trapped hydrocarbons that would otherwise remain untapped. These combined techniques have proved particularly effective in accessing previously untapped reserves in Tanzania’s offshore fields.

As oil prices stabilize and production becomes more efficient, Tanzania’s oil and gas industry will increasingly rely on these enhanced recovery techniques to ensure production growth.

The Power of Digitalization and the Internet of Things (IoT).

Digitalization is reshaping the entire oil and gas industry, including Tanzania’s operations. The use of IoT devices is one of the most transformative elements in this digital revolution. These devices enable real-time data collection across all stages of oil and gas operations, from exploration to production, providing operators with critical insights into equipment performance, resource management, and environmental impact.

In particular, IoT systems help predict equipment failures before they occur, enabling predictive maintenance. This minimizes downtime and reduces maintenance costs, ensuring operations remain efficient and cost-effective. By detecting anomalies in real time, operators can take corrective action immediately, thus reducing the risks associated with unplanned shutdowns.

Moreover, automation technologies, such as automated drilling systems, reduce human error and improve safety during operations. By minimizing the risk of accidents in hazardous environments, automation contributes to a more secure and productive working environment for workers on the ground.

Renewable Energy Integration for Sustainable Operations.

In an increasingly environmentally conscious world, the integration of renewable energy solutions is becoming a key strategy for minimizing the carbon footprint of oil and gas operations. Solar and wind energy systems are being deployed to power remote operations, especially for off-grid locations in Tanzania. These renewable energy systems not only provide a more sustainable energy solution but also ensure energy security in areas with limited access to traditional power infrastructure.

For instance, solar-powered drilling rigs are now becoming more common in Tanzania, significantly reducing the reliance on diesel fuel. This transition to renewable power sources is helping operators lower their operational costs, while also contributing to the country’s broader environmental goals. By adopting renewable energy for drilling and production, Tanzania’s oil and gas companies are positioning themselves as responsible stewards of the environment while enhancing operational efficiency.

The Role of Collaboration and Cloud Computing.

Collaboration is crucial for the success of oil and gas projects in Tanzania, especially given the complex nature of the region’s exploration and production environments. Cloud computing platforms are enabling seamless collaboration among different stakeholders, from operators and contractors to regulatory bodies and technology providers.

By facilitating data sharing and integration, these collaborative platforms allow for better decision-making and operational coordination across the value chain. With the ability to remotely monitor drilling rigs, production facilities, and even exploration activities, experts can provide real-time oversight and support, reducing the need for on-the-ground intervention. This is particularly beneficial in remote and undeveloped regions where technical expertise may not always be readily available.

The ability to manage operations remotely not only increases efficiency but also reduces costs, as it minimizes the need for physical presence in often inaccessible locations.

Enhanced Oil Recovery and Operational Efficiency.

Tanzania’s oil and gas industry is also benefiting from enhanced oil recovery (EOR) techniques that help maximize production from mature fields. EOR technologies, such as gas injection and thermal recovery, are enabling operators to extend the life of existing reservoirs and boost production rates.

By injecting substances like CO2 or steam into a reservoir, EOR methods help displace oil, which otherwise would not flow to the surface due to the natural pressure drop over time. This process improves the efficiency of oil recovery, helping to increase the overall profitability of the reservoir.

Moreover, technological innovations in managed pressure drilling (MPD) and rotary steerable systems (RSS) are improving the precision and safety of drilling operations. MPD techniques help maintain optimal pressure levels in the wellbore, reducing the risk of blowouts and minimizing non-productive time. In addition, RSS and measurement-while-drilling (MWD) systems allow for more accurate and efficient drilling, even in challenging geological formations.

These advancements in drilling and recovery techniques are enabling Tanzania to extract more value from existing resources and extend the productive lifespan of mature fields.

The Future of Oil and Gas in Tanzania.

The role of advanced technology in shaping Tanzania’s oil and gas future cannot be overstated. By embracing innovation in exploration, production, and operational efficiency, the country is positioning itself to capitalize on its natural resources and develop a thriving energy sector. As technological advancements continue to evolve, Tanzania’s oil and gas industry will remain at the forefront of East Africa’s energy revolution.

By integrating the latest technologies, Tanzania’s oil and gas companies are not only improving business performance but also contributing to the country’s economic growth and environmental sustainability. The path forward is clear: with innovation, collaboration, and a focus on operational excellence, Tanzania’s oil and gas sector will continue to thrive, providing energy security and economic prosperity for generations to come.

Dr. Mohamed Mahgoub is an oil and gas industry expert with over 35 years of experience in exploration, production, and energy strategy. Dr. Mahgoub has worked across multiple emerging markets in Africa and the Middle East, offering invaluable insights into the practical applications of advanced technologies in the oil and gas industry. He has served as a consultant to several major oil and gas operators and is recognized for his expertise in maximizing resource extraction, operational efficiency, and sustainable practices in the sector.

Let’s cut the crap—Tanzania’s petrol station market is a goldmine. But, it’s not the way you’re imagining. It’s not about throwing up a station and waiting for customers to show up. That’s the rookie mistake. If you’re not thinking strategically, you’re going to get buried by the competition.

Tanzania’s market is exploding, but to be a winner here, you’ve got to see past the obvious. The people who win won’t just build stations—they’ll own the market. This isn’t about luck; it’s about seeing what’s coming and acting fast. Let’s break down exactly what you need to know to dominate.

Why Tanzania? It’s Not Just Growth; It’s a Massive Opportunity.

Here’s the ugly truth: Tanzania’s growth is off the charts. The country’s population is booming, infrastructure is expanding, and fuel demand is soaring. This isn’t some temporary spike; this is the new normal.

Urbanization is a huge factor here. As cities like Dar es Salaam, Mwanza, and Arusha grow, more cars, buses, and motorcycles hit the road. And the government’s huge push for infrastructure means fuel stations are no longer a luxury—they’re a necessity.

Why it matters:

• Massive Population Growth: More people equals more demand for fuel. Simple.
• Urbanization: The cities are growing fast, and fuel consumption follows suit.
• Infrastructure Boom: Roads, highways, and transport hubs are going to drive the fuel demand to new heights.

The Key to Winning: Don’t Be a Dumbass. Understand the Trends.

Success here isn’t about hoping for the best. It’s about recognizing the trends and getting ahead of the competition. Most people will miss the boat, but not you. Here’s where you need to focus:

1. Location: It’s Everything—Don’t Screw It Up.

You’ve heard it a million times: “Location, location, location.” But here’s the deal—most people don’t know how to pick a good spot. They’ll pick a location because it “seems right,” but that’s how you end up failing.

You need data. Where’s the traffic? Where are the cities growing? What’s the next infrastructure project? Find places where people actually need fuel. That’s where you should build. If you’re not digging deep into these questions, you’re already behind.

Why it matters:

Underserved Areas = Opportunity: Find places that have high potential. That’s your edge.

Infrastructure Boom = Massive Growth: Get in front of urban projects and highways, and you’ll ride the wave of growth.

Actionable idea: Research traffic patterns, urban development, and future infrastructure. Stop guessing. You need facts.

2. Cleaner Fuels = Untapped Potential

If you’re still just thinking about petrol and diesel, you’re missing a massive opportunity. Compressed Natural Gas (CNG) is taking off, especially in public transport. People are looking for cheaper, cleaner alternatives, and CNG is it.

This shift to cleaner fuels isn’t a “maybe”—it’s happening, and it’s going to happen faster than you think. You can either ignore it or jump in now and be the leader in this emerging market.

Why it matters:

Consumer Demand is Here: People are shifting to CNG for cheaper fuel. The demand is real.

Government Support: The Tanzanian government is all in on clean energy, and they’re incentivizing it.

First-Mover Advantage: Get in early, and you’ll dominate before everyone else catches on.

Actionable idea: Install CNG pumps at your stations. Start small if you need to, but don’t wait. This is an opportunity you won’t want to miss.

3. Operational Efficiency = Profit Margin

Forget about fuel price wars. That’s a race to the bottom. The real money comes from operational efficiency. Streamline your operations. Cut waste. Optimize your supply chain, staffing, inventory, and overhead. Every penny saved goes straight to your bottom line.

Efficiency means higher margins, better customer service, and more money in your pocket.

Why it matters:

Price Wars Kill Profits: Stop competing on price and start competing on efficiency.

Higher Margins = Bigger Profits: Operational efficiency is the key to profitability.

Actionable idea: Implement better inventory management and fuel optimization systems. If you’re not cutting costs wherever you can, you’re leaving money on the table.

The Challenges: Wake the Hell Up.

Now, let’s talk about the things no one will tell you. Yes, there’s money to be made, but there are also serious challenges. If you think it’s all going to be easy, you’re in for a rude awakening.

1. Choosing the Right Location

Location isn’t just important; it’s make-or-break. Get it wrong, and you could lose up to 30% of your potential revenue. That’s how critical it is. Don’t just pick a spot because it looks busy—dig deep. Research the traffic flow, nearby developments, and future growth potential.

Actionable idea: Do a feasibility study. Understand high-impact opportunities and mitigate risks that others ignore. Get this wrong, and you’ll regret it for years.

2. Managing Operational Costs

Let’s face it: most petrol station operators suck at managing costs. But the winners are the ones who know how to keep costs low without cutting corners.

Why it matters:

Inefficiency = Lost Profits: If you don’t keep your costs in check, you’re going to lose money.

Smart Operations = Big Gains: Optimize your supply chain, staffing, and other expenses.

Actionable idea: Start tracking every penny. From utility bills to inventory, know where every dollar is going. Efficiency isn’t optional.

The Bottom Line: Don’t Wait for the Competition to Catch Up

Move fast, act smart, and never stop refining your strategy. That’s how you win.