Energy is fundamental to the daily lives of people and the backbone of economic growth across the world. The type and volume of energy a country produces and consumes not only define the technological and economic progress of a nation but also shape the future of its society.

In the context of Tanzania, where energy access remains a challenge, Liquefied Petroleum Gas (LPG) has emerged as a clean and viable alternative to traditional fuels like biomass, including fuelwood and charcoal.

While energy consumption across East Africa has traditionally been dominated by biomass sources, there has been a significant shift towards cleaner, more efficient cooking alternatives. This shift is especially critical in Tanzania, where the Government and international organizations are pushing for cleaner and more sustainable energy solutions as part of the global commitment to achieving the United Nations Sustainable Development Goal 7 (SDG 7)—”Ensure access to affordable, reliable, sustainable, and modern energy for all.”

The Current State of Energy Access in Tanzania.

The Tanzanian energy sector is in a state of transition. Historically, biomass—mainly fuelwood and charcoal—has been the dominant cooking energy source. It is estimated that more than 85% of Tanzanians rely on these traditional fuels for cooking. However, the use of biomass comes at a considerable environmental and health cost.

According to the World Health Organization (WHO), household air pollution from dirty fuels is a leading environmental risk, causing more than 4 million premature deaths globally each year due to respiratory diseases. Of this number, approximately 450,000 deaths are of children under the age of five. Biomass also contributes to deforestation and carbon emissions, further aggravating the impacts of climate change.

As Tanzania progresses towards meeting its energy demands, one promising solution to address these issues is Liquefied Petroleum Gas (LPG). LPG has the potential to replace traditional biomass sources, reduce indoor air pollution, and mitigate the environmental risks associated with the use of charcoal and firewood.

LPG as the Key to Sustainable Energy in Tanzania.

LPG is a hydrocarbon fuel produced by refining crude oil or natural gas, often alongside other fuels such as petrol, diesel, and kerosene. It is widely regarded as a cleaner, more efficient alternative to biomass, providing a solution that not only addresses the growing energy demand but also contributes to reducing health risks and promoting environmental sustainability.

Environmental and Health Benefits of LPG.

One of the most significant advantages of LPG is its environmental impact. Compared to biomass, which generates high levels of smoke and particulate matter, LPG burns cleaner, producing far fewer pollutants.

By switching to LPG, Tanzanian households can significantly reduce indoor air pollution, improving air quality and lowering the incidence of respiratory diseases. In fact, studies have shown that LPG use can reduce household air pollution by up to 80%, a critical factor in improving public health outcomes.

Additionally, LPG is a more energy-efficient fuel compared to charcoal and firewood. It burns at a higher temperature with less wastage, making it a cost-effective solution for cooking. As Tanzania continues to urbanize and industrialize, LPG’s efficiency becomes even more critical in reducing pressure on traditional biomass resources.

Contributing to Tanzania’s Climate Goals.

LPG also plays a key role in Tanzania’s climate goals, particularly in reducing carbon emissions. The reliance on biomass as a cooking fuel has led to widespread deforestation across the country, further exacerbating climate change effects. By shifting to LPG, Tanzania can curb deforestation rates and contribute to global efforts to combat climate change. The Government of Tanzania, in alignment with international climate commitments, has placed a strong emphasis on promoting cleaner cooking alternatives, with LPG being a primary focus.

The Economic Impact of LPG Adoption.

The adoption of LPG as a primary cooking fuel in Tanzania is not just an environmental and health imperative—it is also a significant economic opportunity. The development of the LPG sector could open up a wide array of business and investment opportunities. From supply chain development to distribution and retail, the growth of the LPG market in Tanzania offers a substantial potential for job creation and revenue generation.

Investment Opportunities in the LPG Sector.

The Tanzanian Government recognizes the importance of transitioning to cleaner energy sources and has actively sought to promote LPG adoption. In recent years, several initiatives have been launched to improve the infrastructure necessary for the widespread use of LPG. These include investments in gas refineries, distribution networks, and storage facilities, all aimed at creating a reliable and efficient LPG supply chain.

For investors and businesses, this is a time of immense opportunity. The growth of the LPG sector is expected to generate new revenue streams for local entrepreneurs, particularly in the distribution and retail sectors. As demand for LPG increases, especially in urban areas, there is also an opportunity for innovation in delivery models and retail systems, making it easier for households and businesses to access this cleaner fuel.

Enhancing Economic Productivity.

LPG adoption can have a direct impact on economic productivity. By providing an affordable and reliable cooking fuel, businesses in Tanzania—especially those in the hospitality, manufacturing, and agriculture sectors—can reduce operational costs and improve efficiency. For example, restaurants and food vendors can lower fuel expenses and improve the quality of food preparation by using LPG rather than charcoal or firewood. This not only enhances business operations but also drives economic activity in related industries, such as supply chain management and retail.

Challenges and the Road Ahead.

While the LPG market in Tanzania presents significant opportunities, it is not without its challenges. The cost of LPG cylinders and the infrastructure required to distribute and store LPG remains a barrier for many households, particularly in rural areas. Additionally, there is a need for consumer education to change long-standing habits and perceptions about the use of LPG as a cooking fuel.

Despite these challenges, the future of the LPG market in Tanzania looks promising. With continued investment in infrastructure, technology, and consumer education, LPG is poised to play a key role in addressing the country’s energy challenges, improving public health, and driving economic growth.

Conclusion

Tanzania’s LPG market is undergoing significant transformation. As the country seeks to move away from biomass and other traditional fuels, LPG offers a cleaner, more sustainable, and efficient alternative. The benefits of LPG—ranging from improved health outcomes to environmental sustainability and economic growth—make it an essential component of Tanzania’s energy future.

For executives, operations managers, and senior professionals in Tanzania’s LPG sector, this is a time of opportunity and innovation. By embracing new technologies and strategies, the industry can continue to thrive, providing cleaner energy to households and businesses while contributing to Tanzania’s broader economic development goals.

The oil, gas, and energy sector is a highly competitive industry. Identifying the best oil and gas companies to target for your products or services and where to allocate your marketing resources effectively is key to increasing your winning rates.

Finding high quality leads with a greater capacity for future projects such as drilling, helps vendors to tailor their products and services to better fit the market. This saves time and money and helps to focus your marketing resources to the oil and gas companies who have a high demand for your offerings.

If you are looking for business opportunities in the energy industry this articles will enable you to identify the best oil and gas energy companies to target for submitting a proposal for your services or products.

The article outlines some steps to identify and target high-quality leads in the oil, gas and energy industry. This enables oil and gas service providers, set their strategy with confidence and identify opportunities before their competitors in this ever-changing energy market.

1. Find out who the main players in the market are. 

The first step is to find who are the main players are in the region. Develop a list of both major multinational oil and gas companies, and small independent oil and gas companies that have a physical presence in the region.

2. Look at current oil and gas activity in the area.

Once you have found out the key player, the next step is to identify who is doing what in the region. Find out what kind of oil and gas activities are occurring in the area. Also, find out which companies are likely to have a project in the future. Which company is likely to drill, build oil and gas pipelines or conduct exploration in the areas? Identify their oil and gas production levels. This helps you to narrow your target group prospect and focus your sales and market effort to prospects who are likely to have a project in the region.

3. Gain a high-level overview of the project capacity.

Once you have narrowed your best target business group you need to find more information about the companies’ activities or projects.

If you have learned that some of your prospects are preparing for drilling projects you should dig deep to know how the information that will help have a deeper understanding of these operators and their activity. So, if you have uncovered your prospects are gearing up for the drilling, find out how long it takes these companies to drill their wells.

What is the company’s name that has been contracted to drill the wells? Gather sufficient information about the oil and gas companies(operators) and their prime contractors. Because sometimes oil and gas companies do not buy but their prime contractors do.

To thrive in this ever-changing energy market. Vendors should filter all noise and focus on high probability opportunities that fit your business. To do so they have to work with reliable partners to help them meet their business intelligence demand.

Service and equipment providers should be data-oriented and rely on partners who can give them reliable information and data about the active key players and project activity across the East African oil and gas industry.

On a crisp late May afternoon in Dar es Salaam Ally Awadh, one of Tanzania’s most prominent businessmen, is waxing lyrical about a deal he has just concluded. Recently, the Competition Authority of Kenya gave his company, Lake Oil Group, the go-ahead to acquire all the fuel service stations of Hashi Energy, one of Kenya’s largest independent oil companies

“It’s a first step for us in our pursuit of regional domination,” says the 36-year-old mogul in lightly accented but supple english. “Once you conquer Kenya as a foreign company, then you shouldn’t really have much of a problem prospering in other East African countries.”

Dressed in a black T-shirt, jeans and handmade black loafers, Awadh’s look may be unpretentious. His ambitions are anything but. In less than a decade the young founder and CEO of Lake Oil Group has built his company into a $1 billion (revenues) integrated energy solutions provider, and he’s not resting just yet.

Lake Oil Group, which Ally Awadh founded in 2006, is one of East and Central Africa’s fastest growing energy trading and transportation conglomerates. The company is now one of the 5 largest distributors of petroleum products in Tanzania.

Lake Oil Group also distributes and trades fuel products in Zambia, DRC, Burundi and Rwanda; owns its own oil storage facilities in Tanzania and the Democratic Republic of Congo; manufactures lubes and Ready Mix Concrete Segment, and operates a fleet of more than 400 tankers. Lake Oil Group also has trading operations and gas stations in Rwanda, Burundi, Mozambique, Uganda, Canada and United Arab Emirates.

Ally Awadh was born in 1980 to a family of successful entrepreneurs. His father built a considerable fortune trading agricultural commodities in Tanzania, and as a result Awadh attended the prestigious and exclusive International School of Tanganyika for his High School studies before proceeding to Brock University, Canada, where he studied Business Administration.

“My father basically got tired of me always calling him to ask for more money, so one day he bluntly told me on the phone that I was an adult, and if I wanted any money, I needed to start working for it. It was a reality check for me,” Awadh recalls.

Awadh soon got a job flipping burgers at McDonalds after study hours. “This was a turning point for me,” he muses. “For the first time, I was having to serve people. I was taking orders, handing people their food with a smile, building up on my people skills and just learning how to connect with customers. But more importantly, I was earning my own income, saving and building a nest egg for the future.”

After completing his studies in Canada, Awadh started importing used clothes from Canada to sell in Tanzania. Before long, his second-hand clothing business, which is popularly referred to in Swahili as ‘Mitumba Biashara’ prospered.

“I doubled my money on the first consignment, and I kept replicating it over a period of time. That’s how we built up capital in the business. Before long, I had accumulated a very substantial amount of money, and I was only 23 at the time,” Awadh says.

To consolidate, Awadh soon ventured into the importation of used and refurbished Trucks to Tanzania from the United Kingdom. Simultaneously, he started a milk processing facility which he subsequently sold. By the time he was 25  Awadh had already become a millionaire in American dollars.

At the age of 26, Awadh approached the Petroleum Bulk Procurement Agency (PBPA) in Tanzania and applied for a license to import refined petroleum products. He laughs when he recollects his encounter with an employee at the agency.

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“I was clearly very young and so when I went to the PBPA and asked them to give me a license, this particular guy sized me up and told me I was not serious. He could not believe that someone so young wanted to get involved in the bulk oil import business. But then he looked at our balance sheet and our track record in business, and we clearly had the capacity to play in this business.”

In 2006 Lake Oil Group was born. Awadh assembled a team and began importing fuel products to Tanzania, distributing to gas stations. As he built up his balance sheet, he was able to raise loans from local and international banks which he used to build up oil storage terminals across Tanzania. He also started buying up retail stations and setting up new ones across rural regions in Tanzania.

“As much as possible, we try to focus on constructing our retail stations in up-country areas, rather than focusing only on the urban areas. It has been an extremely successful model for our business. While most companies are looking to have fuel stations in the city centers and the more bustling urban parts of Tanzania, we’ve decided to take the road less taken. We are now also developing fuel stations in Rwanda, Burundi, DRC, Zambia, Malawi and Zimbabwe.”

Awadh is also a major player in Tanzania’s transport sector. Lake Trans, his transportation subsidiary, is one of the largest trucking and haulage companies in Tanzania. “Our venturing into transportation was born out of necessity.

We figured out early on that if we wanted to distribute our products to every nook and cranny of Tanzania, we had to invest in our own distribution. So over time, we have acquired a fleet of more than 400 trucks.” While Lake Trans primarily services the needs of Awadh’s primary businesses, Lake Oil leases it on occasion to other businesses.

Today, Lake Group plays an important function in the lives of many Tanzanians. The company is widely credited for popularizing cooking gas among Tanzania’s rural population. Its cooking gas subsidiary, Lake Gas, is the undisputed market leader in Tanzania and is breaking into to Uganda, Zambia, DRC and Rwanda. Lake Gas recently completed a state of art Gas storage terminal in Tanga, Coastal Town of North Tanzania.

Ally Awadh has built Lake Oil Group into a stunning African success story, but he is quick to attribute his success to his employees. “A company is only as good as its people,” he says. Awadh makes it a point to personally interview every managerial-level employee at his company, and he allows any manager have access to him at any time.

Ally Awadh is still as ambitious as ever. Despite building the most successful indigenous oil marketing company in Tanzania, he still has his sights set on new ventures. Lake Oil Group has established Middle East Ready Mix LLC, a company that produces durable and non-durable concrete that is used for piling, foundations and structures. The company has plants in Dubai AND Tanzania.

Lake Group is also working to establish a Truck assembly yard together with a foreign partner on a Joint Venture basis, and Awadh has recently invested in a Steel Plant at Kibaha, Tanzania and it will be commissioned before the end of 2017. He is also looking to expand his business tentacles into agriculture, farming and Agro process industries in the near future.

The young businessman is one of Tanzania’s biggest philanthropists. Through the Lake Oil Foundation, Awadh spends hundreds of thousands of dollars every year granting scholarships to impoverished Tanzanians and rehabilitating schools and Hospitals.

“My idea is to build Lake Group into a Pan-African diversified conglomerate by the year 2025, employing more than 15,000 people. I believe it’s possible, and as long as God lives, I am unstoppable,” Ally Awadh says.

Source: Forbes