NATURAL gas is a hugely valuable resource, and is only set to become more vital to a great number of countries in the years and decades to come, including Tanzania and its southern neighbour Mozambique.
Not only can it provide power that is economical and efficient, but it burns cleanly and emits very few by-products. It is therefore environmentally friendly when compared to other fuels, such as coal, wood and charcoal, meaning natural gas is an energy source that is going to play a larger role as the world seeks to reduce its carbon emissions.
Traditionally, natural gas has only been utilised by those countries close to gas reserves, as it has been necessary to transport it from source to end user via over ground pipelines. In recent years, however, this situation has changed.
The development of advanced LNG technology has drastically enhanced natural gas’ potential to provide power to countries around the world, because it can now be transported overseas.
So what are the main differences between LNG and pipeline gas? Is one option better than the other? And what does all of this mean for Tanzania? Natural gas and other fossil fuel can be found deep underground, and is the result of plants and animals that have died, and subsequently decayed, over millions of years.
Over time, numerous layers of sand, rock and silt build up on top of these layers of organic matter, and due to a combination of heat and pressure, the material turns into either oil, coal or natural gas.
These three substances are known as fossil fuels, and have been used for hundreds of years to cook food, heat homes and provide energy for all manner of needs. As natural gas is found far below ground level, it can often be incredibly difficult to locate.
Seismic studies are often undertaken by geologists to determine if a particular site is likely to contain gas, and then exploratory wells are drilled to definitively establish whether or not gas is there. Often, these sites are found beneath the ocean bed, so extracting and then transporting the gas can be logistically challenging and very expensive.
Large investments–generally from governments or global energy companies– are often necessary to extract the gas. The process of attaining this investment can often take a long time, and the technology needed for the projects can often take months–if not years –to build. A pipeline is, generally speaking, the most efficient means of transporting natural gas overland for short distances.
Pipelines take the gas from the facility in which it is processed, and then distributed to homes, businesses, and any other amenity that requires power. It has been possible to export natural gas via pipelines for many years, but this method has two significant limitations.
Firstly, it is generally only viable on land. While sea crossings are possible in principle, they are both difficult and costly.
Secondly, pipelines have high fixed costs per kilometre covered independent of the pipeline’s capacity and diameter, while having a relatively low cost. The implications of this is that, while it is usually viable to transport gas over short distances by pipeline, to cover transport over longer distances, very large volumes of gas are needed to make this economically doable.
As an example, the gas pipelines from Siberia in Russia which supply Europe could only be realised because of their massive capacity and size (plus, of course, Europe is a large enough market that all that gas could be absorbed). Fortunately, LNG nowadays can solve both of these problems.
LNG is, to all intents and purposes, natural gas that has been converted to liquid form. This makes the gas safer, because it is not flammable, and therefore means it can be transported overseas. When converted to liquid, it takes up approximately 1/600th the volume of gas in its gaseous state, meaning vast quantities can be stored aboard specially designed vessels, and then exported around the world.
Moreover, LNG also works at small scale, meaning for those circumstances where gas demand is too small to justify the construction of long distance pipelines. Countries like the US and Japan have pioneered this technology since the 1990’s and studies are already ongoing for similar application in Tanzania.
When it comes to LNG and natural gas, Tanzania is currently on the cusp of benefiting hugely. With the country having huge reserves of natural gas – current estimates suggest around 57 trillion cubic feet (TCF).
There are opportunities to not only develop Tanzania’s domestic infrastructure in order to power homes and businesses, but to create a world-leading LNG exporting trade that will bolster the economy and create jobs.
Plans for such development are already in place. The Tanzania Liquefied Natural Gas Project (TGP) is an ambitious venture with the potential to transform the country, and is likely to position Tanzania as a key player in the thriving LNG sector.
With global demand for energy expected to increase by around 35 per cent by 2035, and the demand for natural gas anticipated to rise by a colossal 55 per cent in the same period, there has never been a more opportune time for Tanzania to become a central part of the LNG and natural gas landscape.