42+ Great Business Ideas and Opportunities in the Oil and Gas Sector in Tanzania and Africa

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There are boundless oil and gas opportunities in Tanzania and Africa waiting for men and women with courage and fortitude. Initial costs of setting up some of these businesses may be high.

But with a great business plan, it is easier to secure cooperation from investors and banks as they are already aware the demand for fuel and energy is huge in Tanzania and Africa.

A person is interested in pursuing business opportunities in the industry. should acquire as much knowledge as they can.

If you don’t have a background in the industry, you may work together with a person who has the experience, because valuable insider knowledge could potentially save you monetary and legal problems.

Educating yourself on the kind of business opportunities you’d like to make allows you to choose the most profitable option for you.

So, I’m going to make it simple by laying out the different types of opportunities in the oil and gas industry.

 1.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.

 2. Start a Profitable LP Cooking Gas Retail Shop: The LP Gas retail shop is popularly known as LP Gas dealer or LP Gas reseller. As you walk along the streets of Tanzania, you will notice that there are retail shops at every corner. It is cheap to start this business. You need TZS 2 million to TZS 6 million to start an LP Gas retail shop in Tanzania. The key factors to success in this business are location and your marketing skills. A prime location is a key determinant of the success of an LPG retail shop. Good location and excellent customer services are crucial to success in this business.

 3. LP Gas Distribution and Logistics: Opportunities in the segment is to involve in distributing the LPG and its cylinders through tank trucks to different LPG gas dealers and LPG refilling centers in Tanzania

4. Cooking Gas Site Installation Services

Consumers like Schools, hotels, army campuses, and colleges buy LP cooking Gas in bulk. So they always need bulk tanks and a network of pipelines and cookers to enable to use of LPG for boiling and cooking

You can join forces with a team of a talented individual who has a technical capability and expertise and offering to provide and install LPG infrastructures such as above-ground LPG storage tanks 

5 . Cooking Gas Products and Accessories

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

 

6.LPG (Cooking Gas Wholesale) Distribution

Eligible entrepreneurs can apply to become a large oil marketing company’s super dealer who will work partly with them in the sale of 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 fair 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 full 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 effective supply. The initial capital investment for this venture ranges from Tsh 35,000,000 to Tsh 60,000,000.

 

7.Start a lubricant Production Company/Build lubricant Production Plants.

Local market production of lubricants is very few in the country.  

There are only six lubricant plants in the country that are insufficient to meet the region’s existing and growing demand for lubricant. 

Entrepreneurs looking to participate in the oil industry come in and fill that gap by building a lubricant plant with innovative design.  

 There has been a proliferation of substandard lubricants in the country, causing loss to consumers by damaging their cars and machinery. 

To win in the lubricants market in Tanzania, you need to produce and package high-quality lubricants. That will be your competitive advantage.

Although before venturing into this project, it is essential to determine where your lubricant plant will be located, where you will procure materials, and what type of products you expect to produce to meet market demand. 

And what licenses and permits are required to start operations. So conducting a proper feasibility study will ensure your way to success.

8. Start Lubricating Oils Retail Shop 

This is easy to start a business in the lubricants industry. If you can secure a place and set up a shop nearby garages, you will be in a position to build a profitable business. 

This is because vehicle owners regularly change oils at the garages. That’s why setting up your shop there can guarantee you sustainable profits. Engine oil, grease, and brake fluids are fast-moving items in most lubricant retail shops.

The best marketing strategy for this business is to build a relationship with mechanics, as most vehicles owners and motorists rely on them for advice on what type and where they should buy lubricants for their cars.

9.Set up Lubricants wholesale distributions business

Eligible entrepreneurs can apply to become a significant oil marketing company’s super dealer who will work partly with them to sell their lubricants in the market.

Your supplier(large oil marketing company) will supply you a wide range of lubricants 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 double profit.

As a super dealer, you will have to make sure that you have enough warehouse to keep the lubricants products.

10. Start Importation of lubricant oil 

Importation of lubricant is a thriving and lucrative business in Tanzania. As an oil importer, you can dictate your own price in the market and have the power of introducing your own packaging and new brand in the market

You need to rent a space secured enough to house your products. Due to the proliferation of substandard lubricants, there are many licenses and permits you will need to connect with from regulatory agencies before starting operations. The aim is to ensure that all imported oils meet local and international standards.

11.LPG Gas 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.

12.Oil and Gas Mediator

Oil and gas companies often make deals with equipment and/or service providers, and whenever they do this, the intermediary earns a handsome commission for every successful transaction carried out. The disadvantages of this business model is minimal because it requires next to no startup capital. All you need are contacts of customers in the industry for whom to serve as intermediary and reputable vendor.

13. Maintenance and Servicing

This is another profitable business 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, and most importantly, you need sufficient technical knowledge and you have to assemble a strong team of service engineers and technicians to fully satisfy your clients.

14. Human Resources (Manpower Management)

Companies in the oil and gas industry are busy with operations and productions such as drilling, extracting etc. They want to focus on their core business and that’s why hiring a recruitment agency will save time and hassles with hiring workers.

Bear in mind that companies in the industry hire many people when they have new projects. So, to stand out in this business, you need keep abreast of what new project is forthcoming in the industry and be the first person to approach the clients for manpower management services.

15. Consulting

While many consulting firm in Tanzania and East Africa focus on engineering and project consulting, there is a gap in the market in need of providing 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 own consulting firm, consulting and providing business support for the people who want to build a sustainable business in the oil and gas industry. This business is ideal for people who don’t have a huge capital to venture into an expensive oil and gas business but have in depth knowledge of the oil and gas industry.

16. Products (Fuel) Haulage 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 capacity of the truck.

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 for marketers from depot to their desired destination.

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 countries such as Uganda, Kenya, Rwanda and Congo DRC.

17. Gas Retailing/Distribution

Cooking gas or LPG distribution is one of the most profitable oil and gas business opportunities. Yes, it demands medium scale capital investment. You also need to have proper licensing from the relevant government agency. Also, the market for cooking gas distribution is increasing.

18. 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.

19. 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.

20. 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.

21. 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.

22. Start a TV Show Production

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.

23. Blogging on Oil and Gas-Related Issues

Another easy-to-start business in the oil and gas value chain is to start blogging on oil and gas-related issues. It is interesting to note that there are loads of people out there who are 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 that you can consider starting is to start 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 easily 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.

24. 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 be able to gain ground with this type of business is to ensure that you have relevant contents 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.

25. Lubrication Oil Retail Shop

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

26. Start Manufacturing Cooking Gas Cylinders

Another profitable and thriving oil and gas-related business that an entrepreneur who is looking towards investing in the industry should consider starting is to go into the manufacturing of cooking gas cylinders. There is indeed a large market for cooking gas cylinder. As a matter of fact, households no longer rely on just one cylinder; they prefer to have one or more backups. This is indeed a capital intensive kind of business. It also requires loads of expertise to be able to stay afloat in this type of business.

27. 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 filling station construction/building company. It is important to state that you can only successfully start this type of business only if you have the required training, experience and technical skills. The fact that investors are investing in filling station business means that there will always be a market for engineers who are into the construction of filling stations.

28. Go into the Retailing and Supply 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.

29. Health and Safety Trainings 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 required background (experience and qualifications) to train on health and safety, then you should consider starting an organization that trains oil and gas personnel. In point of fact, health and safety is taken seriously in the oil and gas industry simply because of the risk and hazard that workers in the industry are subjected to in a bid to carrying out their jobs.

30. Manufacturing and Sale of Oil and Gas Machines and Equipment

Manufacturing and sale of oil and gas machines and equipment is yet another thriving and profitable oil and gas related business that an investor who is 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 the manufacturing and sale of oil and gas machines and equipment.

31. Welding Services for Oil and Gas Companies

Another profitable and thriving business in the oil and gas industry that an entrepreneur who is looking towards starting a business in the industry can successfully start after acquiring the required training is to offer welding services. Welding is one of the services that are 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.

32. Oil Farm/Depot

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

33.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.

34. Sell Equipment

The oil and gas industry uses lots of machinery to carry out their 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.

35. Supplying Safety Equipment

Every sector of the oil and gas industry needs lots of safety equipment. Safety is a major concern and a priority in the business. The companies need to buy equipment regularly. This is where your company comes into the picture. You can buy safety gears from major manufacturers and supply companies in the industry.

36. Insurance

The industry is very hazardous so they need proper insurance cover. You can hookup with an insurance company as a sales representative. You make money through the payment of commissions. The more insurance premiums you sell, the higher your profit.

37. Retail Kerosene

Kerosene business is profitable and has a huge market. People use kerosene to cook meals and light fires.

38.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.

39. Oil and Gas Exploration

Oil and Gas exploration is capital intensive and not for the faint-hearted. You need to get an exploration license or block. Exploration involves lots of demographic data, drilling and experts in exploration. You can also secure contracts from other oil companies to use your drilling equipment.

40. Cooking Gas Reseller Shop

Liquefied petroleum gas (LPG) market (popularly known as cooking gas) is expected to grow by fifty percent in the near future 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 key driver to success in starting 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 weighing scale. You will buy the cooking gas from major dealers/superdealers and resell them to households in your target location.
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 the household switching to this fuel increase, demand increase and more customers arise.

41. Offer Legal Services

There are legal practitioners who are well-vested in the business of oil and gas. This set of lawyers are specialized in oil and gas law, and they are making the most out of life in the industry. What they do is to offer legal advice to those in the industry who desire their services. This aspect of business opportunity in the oil and gas industry, according to findings, is a well-acknowledged service and it is a lucrative job for lawyers in the oil and gas industry, and that the job is reserved only for lawyers. So, lawyers, this is an opportunity in the oil and gas industry for you.

42. Start a Crude Oil Refinery

Tanzania import millions of tons of refined petroleum products annually. By building a crude oil refinery using limited stock feed supply in Tanzania, you will not only reduce the amount of petroleum products import in the country but also 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 a huge startup capital, but it is very profitable business if you can pull up resources to start this business.

43. Host Industry Events and Conferences

If 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, you may consider putting together industry events and help professionals and companies learn about new development across the industry and build relationship that are valuable 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 who are looking for visibility and exposure across the oil and gas industry.

I hope this helps

+255(0)655376543 or Hussein.boffu@tanzaniapetroleum.com

 

 

Mozambique Gas Summit Reunites Global Industry at Virtual Summit

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Maputo, 5th October 2020 – On 28-29 October 2020, ENH and dmg events will co-host the Mozambique Gas Virtual Summit, held with the support and participation of MIREME and INP.

The virtual summit will feature keynote speeches from H.E. Valige Tauabo, Governor of Cabo Delgado, Estêvão Pale, Chairman & CEO, ENH, Carlos Zacarias, President, INP and Jos Evens, Lead Country Manager, ExxonMobil Mozambique.

“It is our great pleasure to announce that the Mozambique Gas Summit will be held virtually this year. Through the online platform the industry will be able to reunite, debate, and network with one another, enabling leaders from across the international gas community to share ideas and provide key market updates to the rest of the world.”  Said Estêvão Pale, Chairman & CEO, ENH.

The two-day program boasts presentations from the key players in the Mozambique gas community, and will feature discussions on creating a regional gas masterplan, and an update directly from the newly created Mozambican Local Content Task Force on their mandate, plans and priorities for the energy sector moving forward.

Discussions will also be afforded to the status of project development in Mozambique.

The Mozambique LNG and Rovuma LNG projects will both involve major investments into the local business community over the coming years, with the Total-led project expected to invest $2.5 billion of work dedicated for local businesses, whilst creating more than 5000 jobs during the construction phase of the project.

“In spite of the current pandemic, we have seen the largest private investment in Africa, involving an array of lenders and including around 20 banks. This is extremely significant milestone, and a testament to the investability and excitement around projects being developed in Mozambique.” said Nina Febo, Project Manager, Mozambique Gas Virtual Summit.

The Virtual Summit will offer unparalleled access to Mozambique’s key energy sector decision makers, whereby attendees will be able to network with them virtually, gain access to exclusive content and even visit trade booths in the virtual exhibition.

“We’re creating a platform to help re-connect the Mozambique energy community. The Mozambique Gas Virtual Summit has some extremely innovative features, including a match-making algorithm that will suggest companies for you to meet with based on your business needs. We have seen a real renewed appetite from the local and regional community to reconnect following an extended period of restrictions and the virtual platform will provide this opportunity to meet with existing clients, whilst also seeking out new collaborative ventures.” Added Ms. Febo.

dmg events, along with its partner ENH, invites all key stakeholders seeking to collaborate and access business opportunities in Mozambique and the region to join the Mozambique Gas Virtual Summit, which will reconvene all of the key players from across the Mozambican energy value chain. Attendees from across the world will have the opportunity to network and host private meetings, in addition to resuming collaborative discussions at a critical point for the industry and Mozambique’s gas sector’s future.

-ENDS-

For further information, do visit www.mozambique-gas-summit.com.

About the organiser: 

dmg events  
dmg events leading organiser of live, hybrid and virtual events and a publisher of trade magazines.
We aim to keep businesses informed and connect them with relevant communities to create vibrant marketplaces and to accelerate their business across multiple platforms.
dmg events organises more than 80 events across 25 countries, attracting over 425,000 attendees and delegates every year.  The company’s portfolio of products includes many industry leading events such as ADIPEC and Gastech energy events.
Founded in 1989, the company is headquartered in Dubai, UAE, and is a wholly owned subsidiary of the Daily Mail and General Trust plc (DMGT, www.dmgt.com), one of the largest media companies in the United Kingdom.

For further information, please contact:

Roshan Jan-Mahomed
Roshanjanmahomed@dmgevents.com
07593 441 504

A Sample Business Plan for Starting an LP Gas (Cooking Gas) Distribution/Wholesale and Retailing Business in Tanzania: A Business Plan for one Quick Gas Limited

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Our sample LPG  business plan helps business owners and entrepreneurs like you create a business plan in less time for investor funding, bank loan, compliance with government authorities and for self-learning. 

EXECUTIVE SUMMARY

Overview

There has been a substantial raise in the consumption of liquefied petroleum gas (LPG) in the last ten years. The annual LPG consumption in Tanzania has grown from 5,500 metric tonnes in 2005 to 145,800 metric tonnes in 2019. Furthermore, with continued economic development in Tanzania as well as increasing awareness in the use of LPG as the best alternative to firewood and charcoal, the consumption of LPG will grow to a significantly high level in both urban and rural areas. And with the Tanzanian government’s ambition to scale up the use of LPG across the nation, it will lead to increase in LP Gas demand and supply to hotels, homes, factories, boarding schools, army camps, mines as well as petrol stations.

Although competition in the LP Cooking gas business has increased over the past few years in Tanzania, with our effective marketing and supply strategies, building close client relationship as well as providing complementary services, the newly-established LP Gas retailer like Quick Gas can still be profitable and assured of recovering its entire investment.

The Company

Quick Gas Limited will be a newly-established LPG (Liquefied Petroleum Gas) distributer/retailer in the Kasulu District of the Kigoma Region in Tanzania to cater to the booming LP Gas (cooking gas) demand.

Quick Gas Limited will be duly registered and will obtain a trade license to operate as a Liquefied Petroleum Gas (LPG; popularly known as cooking gas) distributor/retailer in Tanzania. Quick Gas Limited will be equipped with a strong team with both technical and business background in managing all aspects of an LP Gas business: organizing, financing, marketing, promoting products and services, and solving technical and organizational problems.

Products and Services:

Our products and services include:

  • LP Gas (cooking gas) in 6kg, 15kg, 30kg and many other volumes.
  • LPG cylinders of various sizes, colour and design.
  • Cookers and fittings such as pipes, gauges etc.
  • Site installation services.
  • Home delivery of products and services.

Customers/clients:

Quick Gas will deliver LP Gas to household, industrial and commercial customers in Kasulu District in the Kigoma Region and will expand to other location of the city after three years of services.

Competition

Quick Gas Limited will have both direct and indirect competitors but our competitive advantage is that majority of the population will opt for LP Gas rather than buy firewood or charcoal, and there are more customers to go round.

Financial Considerations

The financial projection of this business plan is attached as an spreadsheet file.

Objectives

The underlying objectives of QUICK GAS limited is stated as follows:

  • To be known as a top quality, safe and reliable LP Gas delivery service provider in Tanzania.
  • To achieve and preserve a high gross profit margin.
  • To expand to other location within the city after three years of service in the Kasulu district of Kigoma Region.
  • To achieve 25% of the market share within the first three years.
Form of Business: Limited Liability Company
State of Business: Start-up (new business)
Managing Director: Lawrence Mambo
Business Development Consultant: Hussein A. Boffu
Opening Hours: Mondays to Saturdays: 7 AM – 7 PM.

Sundays: 12 PM – 6 PM

Get the Full Version Now

In the full version, you will have access to the following table of contents:

EXECUTIVE SUMMARY

  • Overview
  • The Company
  • Products and Services
  • Customers/clients

BUSINESS DESCRIPTION

  • Mission
  • Vision
  • Objectives
  • Our Values
  • Keys to Success

PRODUCTS AND SERVICES

MANAGEMENT TEAM

MARKET ANALYSIS AND TRENDS

  • Market Research
  • LP Gas Import in Tanzania
  • LP Gas Industry Trends
  • LP Gas Industry Outlook
  • Our Target Market

COMPETITOR ANALYSIS

  • Direct Competition
  • Indirect Competition
  • Competitive Advantage

SALES AND MARKETING PLAN

OPERATIONAL PLAN

  • Opening Days/Hours
  • Location
  • Setup Cost
  • Machinery/Equipment Requirement

SWOT Analysis

PEST Analysis

FINANCIAL PLAN AND PROJECTION

 

For the complete business plan for starting and running a LP Cooking gas business in Tanzania, make a payment of $200 (or its equivalent in Tanzanian Shillings TZS 400,000) through Tgo pesa, M-pesa to this number: +255655376543.

Once your payment is done, send an SMS to +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 plan will be delivered to your email address (in docx) 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.

Feasibility Analysis on How to Start Your Own Profitable Wholesale Petroleum Products Business in Tanzania

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The current market of petroleum products in Tanzania is $1.77 billion, growing at the annual rate of 15 percent.

With continued economic activities in Tanzania, this growth rate is likely to accelerate in the near term.

Although there has been series of natural gas discoveries in the past 10 years and small gas production in Tanzania, the demand for energy is growing fast and this demand can’t be covered by liquefied natural gas (LNG), new natural gas field development or alternative energy initiatives.

The best way to meet Tanzania’s huge energy demand is the combination of these sources of energy, including petroleum products.

So, no matter how much is imported, more is needed to meet the ever-growing energy need in the country.

The wholesale petroleum products business is so lucrative that aspiring entrepreneurs who are passionate about benefiting from petroleum product wholesaling can jump in to sell to an already available market.

The best part of selling petroleum products in Tanzania is that you are not cajoling people to buy products they don’t intend to buy like multi-level marketers do.

You are serving people who can’t do without your products.

What is Petroleum Products Wholesaling and How does it Work?

Now that you know that there is a huge and profitable market for petroleum products in Tanzania with endless potential growth, let us have a look at what petroleum products wholesaling business is and how it works in Tanzania.

The wholesale petroleum business is nothing new in Tanzania.

Well-know oil brands like Total, Puma Energy (previously Oil BP) etc. are all petroleum wholesalers (popularly known as oil marketing companies). These companies are all foreign.

Over the last few years, several great brands that are owned by Tanzanians started to emerge in the market. You already know brand names like Lake Oil , Afro Oil, and many more.

These companies engage in importing, storing and trading petroleum products to commercial consumers as well as to end users through their retail petrol stations outlet. There is a large upfront investment needed to get tanks, trucks, training, certification and products if you pick to follow these route.

However, there is an exiting and profitable market for independent petroleum wholesalers who operate without their own specific retail brand name.

These wholesalers sell petroleum products to transport companies, mines, farmers, colleges and schools, factories and to some unbranded or privately-owned petrol stations. Some independent wholesalers trade petroleum products to land-locked countries such as Burundi, DRC Congo, Rwanda and Uganda.

The best part of this is that Tanzanians can now actively participate and reap rewards from petroleum products wholesaling. As an independent petroleum wholesaler, your task is to go out and look for customers. Once you get an order, you will relay the order to suppliers and arrange delivery from the supplier’s depot to customers.

I would strongly recommend you target large customers who have the financial muscle to pay you in advance before the delivery.

Also, you have to negotiate with suppliers.

Profit Analysis (How much does independent petroleum wholesaler make in Tanzania?)

There is no limit to the amount of money that you can make in the wholesale petroleum business. It depends on your efforts, commitment and your marketing skills or creativity.

Since the wholesale petroleum products price is regulated and like any other commodity, petroleum products price tend to fluctuate regularly due to exchange rates, international benchmarking or fluctuating oil price in the global market.

Therefore, this tends to affect the profit margin in this business.

But a realistic profit margin that independent petroleum wholesalers make is TZS 60 to 67 per liter.

That means for only for only 100,000 liter per month, a petroleum wholesaler will be able to earn around TZS 60 x 100,000 liters = TZS 6, 000,0000.

Keep in mind that the transportation cost (distribution cost) are added in the price.

How to Become a Petroleum Products Wholesaler in Tanzania

Business Plan:

The wholesaler petroleum products business needs strategic planning to start.

To be completely transparent with you, most Tanzanians do not understand the value of a business plan. They only request for business plan when they want bank loan or they engage in business competition.

While it is vital to prepare a business plan before you start business in market, the emphasis of business plan is essentially as a plan to enter the oil and gas industry.

As an independent petroleum wholesaler, you will compete with wholesale petroleum companies that have huge financial capacity and highly specialized and technical staff.

Your wholesale petroleum business plan will act as a roadmap to reach your business objectives and give you a clear picture on how to compete well in the market.

Register your company:

Get your limited liability company registered with the Business Registration and Licensing Agency (BRELA).

Get EWURA Approval:

The Energy Water and Utilities Regulatory Authority (EWURA) is the government agency that regulates the downstream petroleum product sub-sector in Tanzania. You have to get a wholesale petroleum license that allows you to sell petroleum products to bulk customers.

Keys to Success

Merging:

To ensure a good profit margin, pick a supplier who will offer you high-quality products at competitive rates

Marketing Skills:

As I mentioned earlier, you compete with petroleum wholesalers who have huge financial muscles and talented technical team.

So, employing the best marketing strategies will help you to compete well in this industry.

Want to Start Your Business in Tanzania’s Oil and Gas Sector? Here’s How

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Have you ever wanted to start your own business in the oil and gas sector in Tanzania?

If you answer yes, then it’s a wise decision to pursue.

Tanzania’s oil and gas sector is another name for wealth. To verify my words, plan a visit to the Oyster Plaza building in Masaki, Dar es Salaam, where there are a lot of oil and gas companies’ offices. You will be shocked once you see Mercedes Benzes, BMWs, and all kinds of expensive cars in the parking areas outside the buildings.

This is a living testimony that they make huge money from the oil and gas industry.

The simple truth is that oil and gas entrepreneurs are super busy. They have only two options: either to take a flight for a meeting abroad or to deal with clients. But if you are lucky to meeting them even for 10 minutes, you will be amazed at their lifestyle.

And the reasons they make that huge money is because oil and gas products are fast-moving commodities in the world. The demand for oil and gas end-product and by-products are huge in Tanzania and across the world.

Tanzania has discovered 57.25 trillion cubic feet of natural gas. But according to the US Geological Survey, the country still has potential natural gas reserves up to 441 trillion cubic feet solely in the coastal region, so more gas discovery might be forthcoming.

My friend, oil and gas resources are wealth. The oil and gas sector has turned ordinary and poor people into extraordinary, wealthy people.

The best part of this industry is, the earlier you start, the better. Don’t wait until 2020 to enter the market, because a lot of international guys and only a few groups of Tanzanians are smiling to the bank with money coming from the industry.

I am not saying this to impress, but I want you to start benefiting from the huge gas discovery in our land.

Instead of being proud that you are in the country blessed with huge natural gas resources, now you should know how to monetize these resources and reach your mountaintop.

But don’t get me wrong, this is not a get-rich-quick scheme. To make good money in this industry, it requires a long-term commitment and building a strong relationship with clients. And just like anything worth having, it takes effort.

Are you interested in starting business In Tanzania’s oil and gas? Here are the requirements:

1. Find A Niche

Tanzania oil and gas is huge, and there are multiple routes to break into this industry. So, the first things you should identify are business activities that you have proven capabilities and capacity to do well.

I meet a lot of entrepreneurs who want to do all trades in the industry. But that’s not for you. Because you won’t succeed if you want to engage in all the trades at once.

To succeed in this sector, you have to put 100% of your energy into one business activity. And once you are doing well in that business activity, that’s when you diversify.

Finding a niche starts by identifying products or services you want to render in the industry.

Here are some of the business activities you could decide to do in Tanzania’s oil and gas sector:

  1. Become an oil operator. You will set up a company that searches and extracts oil and gas resources out of the ground. You might hear it often called Exploration and Production Company. It is capital intensive because it requires advanced technology, equipment, machinery, and highly trained manpower with expertise and experience in extracting oil and gas resources. But it yields solid profit if you manage to go on it.
  2. Offering mechanical services (e.g. welding and fabrication services.)
  3. Catering services (e.g. feeding oil and gas workers or pipeline construction crew on the campsite.)
  4. Logistics and transportation services.
  5. Offering oil and gas tools and equipment (e.g. pipes, valves fittings, drilling bits, casing pipes, etc.)
  6. Selling drilling chemicals, corrosion inhibitors and oil and gas materials (e.g. barite, bentonite, sodium chloride, uniform, coveralls, safety boots, gloves, etc.)
  7. Finance and insurance services.
  8. Legal and IT services.
  9. Supply of office materials.
  10. Engineering procurement and construction management.
  11. Wireline services, direction drilling services, well drilling services, maintenance services, etc.

And the list goes on.

2. Register With The Business Registration And Licensing Agency (BRELA)

Once you have identified the services you want to render in the industry, the next step is register with BRELA.

This is imperative because no individual is allowed to bid in the oil and gas sector. It’s only for registered companies. So, do business in Tanzania without getting into a legal trouble. You should register a business name or limited liability company with BRELA.

Registering with BRELA is fast, easy, and cheap, if you meet their qualifications. Here are the requirements to get registered with BRELA:

  1. Memorandum and article of associations.
  2. List of shareholders and directors (their names, address, and date of birth.)
  3. Share distribution.
  4. Share capital.
  5. Name of the company secretary.

3: Get Necessary Licenses And Permits

Now that you have registered your company with BRELA, and BRELA has given you a certificate of incorporation, the next requirement is getting licenses and permits.

But permits and licenses vary depending on the kind of oil and gas activity you intend to do.

If you want to be an oil operator; that is, you buy a gas block for extracting oil and gas resources, the agency responsible for such permit is Tanzania Petroleum Development Corporation (TPDC).

If you want to be a contractor (those who want to provide engineering, construction, mechanical services, and other technical jobs), you shouldyou’re your permit from the Contractor Registration Board (CRB).

For suppliers and consultant, get a permit from the Regional Trade Office.

Bonus: For entrepreneurs who want to setup a lubricant (engine oil) or petrol station business, get a license from the Energy Water and Utility Authority (EWURA).

4. Register With Oil And Gas Companies You Want To Work With

Now that you have a license to operate in Tanzania oil and gas sector, the next step is to register your name with international oil and gas companies as a vendor (contractor or supplier.)

5. Win Your First Contract

The most challenging task in the Tanzanian oil and gas industry is getting your first contract. This is because nobody wants to be the first customer. But sometimes you need only one customer to grow fast in the industry.

To grow fast in the industry, alliance, partnership, and joint venture across the country with experienced international oil and gas contractors is necessary.

Attend conference trade shows and join Tanzania oil and gas associations.

This will enable you to learn how to do business with large oil and gas companies in Tanzania and increase your contacts.

What Are You Waiting For?

Now you know the requirement to  start  the oil and gas business in Tanzania. If this interests you then it is time take all necessary steps to make this reality.  You can do this if you commit yourself to your own success.

Does it Take Rocket Science to Succeed in the Oil and Gas Sector in Tanzania?

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Think back for a moment.

What do you imagine when someone mentions the oil and gas sector?

Businessmen worth billions? Oil barons? The government?

Let me also ask: what do you think it takes to succeed in the oil and gas sector in Tanzania?

I have some good news for you.

It’s not by having a huge capital, neither by offering the most perfect products, nor by even having a lot of contacts in the industry.

Sure, it does help, but not always.

Supposing you want to climb Mountain Kilimanjaro (the tallest mountain in Africa), would you go climbing yourself or get an experienced guide who would lead you to the summit?

It’s the same in the oil and gas sector, too.

To succeed in Tanzania’s oil and gas sector, you need to find experienced people who have succeeded in the sector, people who are willing to guide you.

Once you can do that, you can be sure that when you follow their steps, you’ll succeed.

There’s a catch, though.

A Guide For a Million Dollars

Yes, you heard me right.

That’s how much it takes to get an experienced person in the oil and gas sector to guide you.

Imagine consulting your mentor at $200 per hour. I’m just estimating low. Some will charge you $500 per hour. Some, a thousand dollars.

Imagine that. O-N-E T-H-O-U-S-A-N-D D-O-L-L-A-R-S.

Multiply that by a minimum of three hours per day.

Multiply that by a minimum of three times per week.

Multiply that by four weeks in a month.

(You would have learned much in a month, but still, you won’t be able to stand on your own yet. You need a minimum of six months to a year to learn all it takes.)

Multiply that by a minimum of six months.

Here’s the breakdown for a $500 per hour consultation lasting three hours for three times a week, and for six months:

$500 * 3 hours * 3 times per week * 4 weeks in a month * 6 months = $108,000

That’s a whooping sum of money. And you can bet your money that you’d have made ten times that amount in six months.

But can you afford it?

For you, that’s like a million dollars.

An Alternative Guide For a Few Bucks

But what if I told you that you can learn how to start an oil and gas supply and services business in Tanzania without annoying anybody?

What if I told you, you can save a ton of time on getting a guide, on how to get deals, on how to prepare acceptable prices (quotation), and on winning contracts and supplies?

What if I told you can save a lot of money in discovering the main area of business opportunities in the oil and gas sector in Tanzania, the list of goods and tools you can start to supply, and how to register your business as a supplier or contractor with various oil and gas companies in Tanzania?

If you would like to sell products or offer services to the oil and gas sector and make a large profit margin, I encourage you to download our guide titled, “How to Recognize Potential Business Opportunities in the Oil and Gas Sector in Tanzania.”

In this guide, you will discover:

  • How to start an oil and gas supply and service business in Tanzania. Everything about planning your business, market analysis, and financing your business.
  • How to become a contractor or supplier, including licenses and permit you to need to get started with the oil and gas supply and services business.
  • A roadmap on how to recognize potential business opportunities and how to be noticed and considered by oil and gas firms.
  • How to present your goods and services to oil and gas companies.
  • How to get deals and win contracts. You will learn how to prepare and submit an acceptable bid or proposal.
  • How to raise money for your supply or contract.
  • A list of goods you can start to supply to oil and gas companies.
  • The main area of business opportunities in the oil and gas sector in Tanzania.
  • Tips to survive in Tanzania’s oil and gas sector.
  • More interesting businesses opportunities in Tanzania’s oil and gas sector.
  • List of oil and gas companies that are searching for oil and natural gas in Tanzania.

…and many more.

I’m not asking you for a million dollars. Not $10,000. In fact, I’m not even asking for $100.

Download this guide now for TZS 30,000 now.

To buy the book, make a payment of TZS 30,000 through Tgo pesa, M-pesa to any of these numbers:

+255689955711
+255655376543
+255653702878

Once your payment is done, send an SMS to +255689955711 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 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.

Meet the Author

Hello, my name is Hussein Boffu, and I’m the author of How to Recognize Potential Business Opportunities in the Oil and Gas Sector in Tanzania. I’m also the author of How to Start and Run a Profitable Petrol Station Business in Tanzania. I’m also the founder of TanzaniaPetroleum.com

I am an entrepreneur specializing in the oil-and-gas supply chain. For quite some time now, I’ve been consulting a lot of businesses, both local and international, regarding starting a business in Tanzania’s oil and gas sector.

I have been approaching and talking to executives, and have been selling goods and equipment to various oil-and-gas companies in Tanzania.

The Complete Guide for Just a Token

To buy the book, make a payment of TZS 30,000 through Tgo pesa, M-pesa to any of these numbers:

+255689955711
+255655376543
+255653702878

Once your payment is done, send an SMS to +255689955711 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 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.