Hormuz disruption revives Equinor’s stalled Tanzania LNG project

Norwegian energy group sees East African gas as safer alternative to Gulf supplies

August 25, 20262 min read

By Nerijus Adomaitis

Stavanger, Norway — The disruption to energy flows in the Strait of Hormuz is making it more attractive for Equinor to develop a long-stalled liquefied natural gas export (LNG) plant in Tanzania, the Norwegian company said on Tuesday.

The US-Israeli war with Iran is reshaping the global energy industry, stripping Qatar and other Gulf producers of their reputation as some of the world’s most reliable suppliers as Tehran struck export plants and blocked shipments.

Discovered more than a decade ago, the massive Tanzania gas deposit is expected to cost about $42bn to develop, the East African nation has estimated, and it would provide an alternative source of supply for Asian customers.

Hopes dashed

But Equinor’s talks with Tanzania over detailed investment terms and conditions have been ongoing for years, and hopes for a breakthrough have been dashed on several occasions.

“You don’t want to wait too long to put new LNG volumes on the market, so maybe now is a good time to get on with it,” Equinor’s head of international operations, Philippe Mathieu, told reporters at an energy conference in Norway on Tuesday.

When asked if the Middle East LNG disruption is making the Tanzania project more attractive, Mathieu said, “Exactly. It means you are producing LNG in an area which is not exposed to these kinds of geopolitical challenges.”

Equinor and Shell are joint operators of the mega gas project, which would help develop Tanzania’s 47.13-trillion-cubic-foot offshore gas resource, while ExxonMobil, Pavilion Energy, Medco Energi and Tanzania’s national oil company TPDC are partners.

Exploration drilling

Mathieu also said Equinor hopes to make a “pretty big” oil discovery in Namibia’s PEL 90 exploration licence, hoping to match major nearby finds made by TotalEnergies and Galp.

Equinor last week said it had bought a 17.4% stake in the Chevron-operated prospect and that exploration drilling would take place later this year.

Reuters