Tanzania signs development credit agreement with World Bank

Oct 22, 2001 02:00 AM

Tanzania has signed the development credit agreement with the World Bank in Washington under which the International Development Association (IDA) will make available to Tanzania some $ 183 mm, for the Songo Songo Gas project.
Leaders of the project are the World Bank through IDA and the European Investment Bank (EIB). The Tanzanian Ambassador to the United States of America, Mustafa Nyang'anyi signed the agreement with the World Bank in Washington. Signing of the credit agreement followed decisions reached on October 11 when Basil Mramba, Finance Minister, Edgar Maokola-Majogo, Minister for Energy and Minerals, signed the project agreement with stakeholders in Dar Es Salaam.

The Songo Songo Project involves the development of the 1 tcf natural gas reserves in Southern Tanzania, a gas gathering and processing, the construction of a 25 km marine pipeline and a 217-meter land pipeline to Dar Es Salaam from the source. The gas will be transported to the Dar Es Salaam-based, Ubungo thermal powerplant, which will be converted to gas firing.

AES based in Arlington, Virginia, is the lead investor in the project with a $ 50 investment. The other shareholders Songas, CDC Financial Services, Tanzania Development Finance, Tanzania Electricity Supply Company (TANESCO) and Tanzania Petroleum Development Corporation (TPDC).
"All of the financing for the project is now in place and the construction phase of the project is underway," a statement said. Bid documents for the major contracts are expected to be issued in mid November and be awarded March 2002. All the electricity will be sold through a 20-year power purchase agreement with TANESCO and gas not required will be marketed be Pan-African and TPDC.

Source: AllAfrica.com
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