June 2018 – The Tanzanian government has advanced midstream and downstream natural gas activities by instituting key pipeline safety rules, steps that will promote investor confidence in the sector and improve the enabling environment for private investment in the country.
The Petroleum (Natural Gas) (Transmission and Distribution Activities) Rules, 2018, were published in the Tanzania Government Gazette on May 4. The rules address various aspects of regulating and enforcement of natural gas pipeline safety activities for transmission and distribution pipelines.
The rules aim to ensure the safe and reliable provision of natural gas to electricity generation stations and households, helping to fill a necessary gap in the regulatory framework for gas operations in Tanzania. Given the vast potential for natural gas development in Tanzania, incorporating a strong regulatory framework can help provide investors with confidence in the physical safety and financial viability of their investments.
The rules can also help to facilitate progress on increasing Tanzania’s generating capacity and helping the country phase out expensive and higher-emitting diesel electricity generators.
Eng. Thobias P. Rwelamila, Gas Distribution Manager for EWURA.
Prior to their publication, the rules were drafted by Tanzania’s Energy and Water Utilities Regulatory Authority (EWURA) and subsequently reviewed and approved by EWURA’s Electricity and Natural Gas Board Committee. By gazetting the natural gas transportation and distribution rules, EWURA now has a legal platform and standards by which the regulator can enforce specific pipeline safety measures for the technical and procedural aspects of mid- and downstream natural gas pipeline development and maintenance.
The approved rules also provide certainty to potential natural gas developers and investors that mid- and downstream activities have clear and transparent safety processes that must be followed by all developers. The rupturing of a natural gas pipeline can be very dangerous to people and property. If a single company does not follow pipeline safety standards, it can have a significant impact on other pipeline operators/developers.
Through the support of USAID and Power Africa, NARUC experts engaged with EWURA officials during an August 2016 workshop to peer review draft versions of the rules. NARUC experts offered recommendations on how to enhance consistency and clarity with the rules while also sharing best practices on conducting safety inspections and the technical and procedural features of safe and reliable gas operations.
"The published rules shall make the existing service providers and new entrants converge into one regulatory framework,” said Eng. Thobias P. Rwelamila, Gas Distribution Manager for EWURA. “The rules create confidence for investors and may attract more investment in the mid- and downstream segments of the gas sub-sector in Tanzania.”
USAID and Power Africa are supporting further work with EWURA. NARUC is working with the Tanzanian regulator to improve data collection and analysis to enhance tariff development capabilities and to strengthen the regulator’s capacity further on pipeline safety. NARUC and EWURA are also exploring practical safety-related trainings and overall customer service quality improvement.
This story is made possible by the generous support of the American people through the United States Agency for International Development (USAID). The contents are the responsibility of NARUC and do not necessarily reflect the views of USAID or the United States Government.