Tanzania's gas and oil regulator lacks the capacity to execute its mandate, report shows.

The Controller Accounts General’s (CAG) report for the period ending June 30, 2016 raised questions about the capacity of the Tanzania Petroleum Development Corporation (TPDC).

CAG's Prof Mussa Assad said TPDC was in danger of releasing inaccurate reports due to lack of sufficient knowledge in analysing the geological and geo-physical data.

He said that from a total of 71 projects which were registered in the exploration and development of oil and gas between 2010-2015, only 4 per cent had been inspected to determine their level of compliance with the environmental regulations.

Follow-ups

The report further shows that there have been no further effective inspections and follow-ups on the oil and gas projects to establish if they observed the environmental protection standards.

CAG further indicates that there was a general lack of efficiency in revenue collection from the oil and gas exploration activities around the country.

Consequently, the government proceeds fell below average.

For the last five years of a trading period, the Tanzania Revenue Authority (TRA) collected below the average of $92.4 million (TSh 208bn), an amount equivalent to a single ministry's annual budget allocation.

Local experts

CAG further noted the lack of capacity to produce enough local experts for the increasing demand for the sector, noting the government only managed to meet 20 per cent of the total experts demand.

The report further shows that there was a shortage of 48 per cent trainers in its audit of six training institutions chosen to lead the provision of training and skills in the oil and gas sector.

In addition, CAG discovered the existence of weak supervisory system for the implementation of regulations and procedures to involve the locals in the gas and oil sector.