Friday, May 20, 2016

Rural power installations in the country up by 50pc

THE Ministry of Energy and Minerals has increased the budget for rural electrification by 50 per cent, from 357bn/- in the 2015/2016 fiscal year to 534bn/- in the coming year as it struggles to ensure Tanzanians are supplied with reliable electricity. Presenting his budget estimates for the 2016/17 financial year yesterday, the minister, Professor Sospeter Muhongo, insisted that all projects under the Rural Energy Agency (REA) will be implemented as planned. He informed the House that the power access level has also gone up by four per cent. About 40 per cent of Tanzanians are now connected compared to 36 per cent that was recorded last year. For the first time, 94 per cent of the total budget of the ministry for the next financial year has been allocated for development projects. Budget estimates for the ministry in 2016/2017 fiscal year stands at 1.12 trillion/-. According to Prof Muhongo, 1.05tri/- will be channeled to fund development projects while the remaining 66.2bn/- will cater for recurrent expenditure. "Basing on section 43 (a) of 2015/2020 CCM election manifesto, which directs the government to increase power production, the ministry has allocated 98 per cent of the development project funds for the energy sector," Prof Muhongo reported. "REA is now in the process of getting a contractor who will supply power to 121 villages where the Iringa-Shinyanga Grid passes through," he added. Prof Muhongo explained that the government is going on with the implementation of electricity supply industry reform strategy and roadmap in a move aimed at transforming energy sector. He asserted that by 2019/2020, there were some power projects that are due for completion and which will greatly help increase power accessibility in the country. The projects are Singida-Arusha-Namanga (400kV), Bulyanhulu- Geita (220kV), Geita-Nyakanazi (220kV), North-East Grid (400kV) and Somanga-Kinyerezi (400Kv). The minister also noted that completion of the 542km Mtwara-Dar es Salaam gas pipeline project has, among other things, helped rein in the cost of electricity generation. The government has also earmarked some 800m/- for setting up the Liquefied Natural Gas (LNG) plant in the coming financial year. Prof Muhongo informed the House that the ministry was in the final stages of putting in place a Petroleum Upstream Regulatory Authority (PURA) to control all issues related to petroleum products. PURA, according to the minister, is set to be a full regulatory body by July. Prof Muhongo also affirmed that the government has completed establishment of Petroleum Bulk Procurement Agency (PBPA) since January. 

Tanzania's Minister for Energy and Minerals, Professor Sospeter Muhongo

The agency, among other assignments, is tasked with handling all activities that were being done by the Petroleum Importation Coordinator Limited (PICL). PICL’s key role was to manage petroleum bulk procurement system. “In 2016/2017, the agency will as well start overseeing importation of Liquefied Petroleum Gas (LPG) and Heavy Fuel Oil (HFO) through bulk procurement system. Prof Muhongo said that the government’s shares in PUMA Energy Tanzania Limited, Tanzania-Zambia Pipeline Limited, TAZAMA, and Tanzania International Petroleum Reserve (TIPER) have remained intact. The government has 50 per cent shares in PUMA Energy Tanzania Limited, 30 per cent in TAZAMA and 50 per cent in TIPER. Meanwhile, Tanzania will own the stake in the Uganda refinery being part of an agreement for all East African countries to own shares in the plant. Prof Muhongo said that Uganda agreed that every EAC member state will own eight per cent (approximately 335bn/-) of shares in the project in line with strategies of integrating the regional economies. On the 1,443km Uganda-Tanga Crude Oil Pipeline Project, Prof Muhongo said that talks on the implementation of the multi-billion shillings project have started. Parties involved in these talks are the governments of Tanzania and Uganda, TOTAL (France), CNOOC (China) and Tullow (UK). The minister also affirmed that the government has intensified war against smuggling of minerals. For instance, he said, such efforts have helped the ministry to seize minerals worth 3.3bn/- in 2015. Meanwhile, the Opposition Camp has challenged the government to ensure that it properly manages minerals, which the country is endowed with for the benefit of all Tanzanians. Presenting the opposition’s views, Shadow Energy and Minerals Minister John Mnyika, said the country was not benefiting much from its natural resources due to lack of proper management and dubious deals the government was inking with foreign investors. Mr Mnyika also wanted the government to honour resolutions reached by the National Assembly relating to the controversial Tegeta escrow account. “We are saddened that some of the resolutions are yet to be implemented. TANESCO are still paying a lot of money to IPTL... we need the government to act now and respect the resolutions,” he demanded. The Chairman of the Energy and Minerals Committee, Mr Dotto Biteko, advised the government to chart out strategic plans that would help the country in proper management of natural gas resource.

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