Tanzania bets on compressed natural gas to cut oil imports

The Tanzanian government launches a national consultation to accelerate the rollout of compressed natural gas, mobilising public and private financing to secure energy supply and lower fuel costs.

Share:

Subscribe for unlimited access to all energy sector news.

Over 150 multisector articles and analyses every week.

Your 1st year at 99 $*

then 199 $/year

*renews at 199$/year, cancel anytime before renewal.

Tanzania is taking a new step in its energy policy by placing compressed natural gas (CNG) at the centre of its strategy to reduce dependence on oil imports. The authorities plan to hold a national consultation bringing together investors, banks and regulators to remove financial barriers slowing down the construction of CNG infrastructure.

A state-backed plan

Deputy Minister of Energy James Mataragio said the government wants to reassure financial stakeholders about the viability of the sector. According to him, development costs can remain manageable provided that financing mechanisms are properly structured. This initiative is part of a public investment approach aimed at stimulating private sector involvement.

Pilot projects already underway

Some local and international companies have already committed to projects. BQ Construction is preparing a station capable of serving 180 vehicles per day, while Puma Energy plans to have four stations operational within three months. These projects are expected to complement state efforts to accelerate the availability of this energy alternative across the country.

An inspiring precedent in Nigeria

The Tanzanian approach draws inspiration from Nigeria, where $700mn of investments were mobilised in 2024 to expand CNG. The federal government set an incentive price of 230 naira ($0.15) compared with more than 900 naira ($0.59) for petrol. This measure encouraged vehicle conversions and enabled the launch of more than 90 stations backed by Shell Nigeria Gas and NNPC Gas Marketing.

A regional and long-term ambition

Beyond lowering fuel costs, Dar es Salaam aims to secure its energy future through the upcoming development of offshore gas reserves. The government intends to use this resource to limit exposure to volatile oil prices and position itself as a regional supplier. A study by Dairy Hills indicates that CNG use could reduce energy costs by 58%, while also requiring continued public mobilisation to adapt infrastructure and train specialised professionals.

Nigeria’s state-owned oil company abandons plans to sell the Port Harcourt refinery and confirms a maintenance programme despite high operating costs.
The publication of the Multiannual Energy Programme decree, awaited for two years, is compromised by internal political tensions, jeopardising strategic investments in nuclear and renewables.
The US Energy Information Administration reschedules or cancels several publications, affecting the availability of critical data for oil, gas and renewables markets.
Brazilian authorities have launched a large-scale operation targeting a money laundering system linked to the fuel sector, involving investment funds, fintechs, and more than 1,000 service stations across the country.
A national study by the Davies Group reveals widespread American support for the simultaneous development of both renewable and fossil energy sources, with strong approval for natural gas and solar energy.
The South Korean government compels ten petrochemical groups to cut up to 3.7 million tons of naphtha cracking per year, tying financial and tax support to swift and documented restructuring measures.
The U.S. Department of Energy has extended until November the emergency measures aimed at ensuring the stability of Puerto Rico’s power grid against overload risks and recurring outages.
Under threat of increased U.S. tariffs, New Delhi is accelerating its energy independence strategy to reduce reliance on imports, particularly Russian oil.
With a new $800 million investment agreement, Tsingshan expands the Manhize steel plant and generates an energy demand of more than 500 MW, forcing Zimbabwe to accelerate its electricity strategy.
U.S. electric storage capacity will surge 68% this year according to Cleanview, largely offsetting the slowdown in solar and wind projects under the Trump administration.
A nationwide blackout left Iraq without electricity for several hours, affecting almost the entire country due to record consumption linked to an extreme heatwave.
Washington launches antidumping procedures against three Asian countries. Margins up to 190% identified. Final decisions expected April 2026 with major supply chain impacts.
Revenues generated by oil and gas in Russia recorded a significant decrease in July, putting direct pressure on the country’s budget balance according to official figures.
U.S. electricity consumption reached unprecedented levels in the last week of July, driven by a heatwave and the growth of industrial activity.
The New York Power Authority targets nearly 7GW of capacity with a plan featuring 20 renewable projects and 156 storage initiatives, marking a new phase for public investment in the State.
French Guiana plans to achieve a fully decarbonised power mix by 2027, driven by the construction of a biomass plant and expansion of renewable energy on its territory.
The progress of national targets for renewable energy remains marginal, with only a 2% increase since COP28, threatening the achievement of the tripling of capacity by 2030 and impacting energy security.
A Department of Energy report states that US actions on greenhouse gases would have a limited global impact, while highlighting a gap between perceptions and the economic realities of global warming.
Investments in renewable energy across the Middle East and North Africa are expected to reach USD59.9 bn by 2030, fuelled by national strategies, the rise of solar, green hydrogen, and new regional industrial projects.
Global electricity demand is projected to grow steadily through 2026, driven by industrial expansion, data centres, electric mobility and air conditioning, with increasing contributions from renewables, natural gas and nuclear power.

Log in to read this article

You'll also have access to a selection of our best content.

or

Go unlimited with our annual offer: $99 for the 1styear year, then $ 199/year.