Dar bows to pressure, makes details of gas contracts public

Saturday March 14 2015

Gass pipeline from Songo Songo to Dar es Salaam. PHOTO | FILE

The Tanzanian government has finally agreed to make public details of production-sharing agreements (PSAs) it signs with investors in the natural resources sector.

Tanzania Petroleum Development Corporation (TPDC) officials said the PSAs will be accessed in the next few months before the general election slated for October.

According to TPDC, the publishing of the contracts will be made in phases starting with the 26 PSAs of 18 international oil companies (IOCs), which have so far discovered over 50 trillion cubic feet of natural gas in the country.

The decision to make the contracts public was made last month after a consensus on the matter between TPDC and the Public Accounts Committee (PAC) was endorsed by the government.

“The decision to make details of the 26 PSAs signed with oil companies public was made in February during the meeting between TPDC and PAC. We have started submitting those PSAs available through the Parliament Office,” director general of TPDC Dr James Mataragio, told The EastAfrican.

READ: Tanzania, oil firms resist calls to make agreements public


ALSO READ: Secret deals with oil and gas firms generate heat in Dar

Last year, the PAC and TPDC were involved in a tug-of-war over the matter, with the former ordering the arrest of board chairman Michael Mwanda and then acting head of TPDC James Andilile.

The two officials were on November 2 last year detained for hours by police after defying a PAC order to deliver the agreements to parliament. TPDC had for two years declined to present the contracts to the PAC.

According to acting Permanent Secretary for Energy and Minerals Ngosi Mwihava, making the contracts public was sanctioned after the Attorney General’s office gave the process the nod. Dr Mataragio said all parties were consulted before decision to make the documents public was reached.

“The Attorney-General gave directives on how the issues should be handled, therefore the contracts will soon be available for the public. These will be PSAs without any controversies while those with the confidentiality clauses will wait until other parties involved have been consulted,” he said.

One of the conditions oil companies have given the government for their PSAs to be publicised is to ensure the public is first educated on the nature and structure of the technical aspects of the deals.

The education programme, which will include TV and radio programmes and commentaries, newspaper articles and brochures explaining PSAs, was supposed to start two months ago.

For years now, the government had resisted calls to make the documents public. Keeping details of the agreements close to its chest gave the opposition enough reason to call for change of government in the forthcoming general election on grounds that the President Jakaya Kikwete-led administration has not managed exploration of natural resources transparently.

The timing of the government’s decision to pull the lid off the contracts is seen as a tactic geared at winning votes in the forthcoming general election.

Political analyst Emmanuel Kisumo doubts the government’s commitment to making the contracts public.

“It is political. There were many opportunities in the past for the government to do the right thing but instead it gave conflicting responses. Why now? What has changed? The government is pre-empting what was definitely going to be an election issue. The opposition has been caught on the back foot,” he said.

However, other leaders believe that the government succumbed to relentless pressure from the PAC, which for many years has pushed for release of the crucial documents.

Led by its chairman Zitto Kabwe, who this week was stripped of his membership by leading opposition party Chadema, PAC pushed for the release of the agreement for Tanzanians to scrutinise them.

This was after a leak part of a contract between the government and Norway’s Statoil and ExxonMobil of the US showed that Tanzania was given a raw deal on how proceeds will be shared.