November 2019, Vol. 246, No. 11


Why Tanzania, Zambia Want a New Oil Pipeline

By Shem Oirere, P&GJ Correspondent

Demand for refined petroleum products in Tanzania has been increasing in recent years, and the East African country has proposed a new oil pipeline project to meet the consumption requirement for refined fuels, especially in the southern parts where there is growing development of new mining and industrial projects.

The Tazania Zambia Mafuta Pipeline. (source: P&GJ/Energy Web Atlas)

Although Tanzania’s consumption of refined fuels was estimated at 52,000 bpd by 2014, Tanzania’s Energy and Water Utilities Regulatory Authority (EWURA), an autonomous multi-sectoral state authority that regulates the electricity, petroleum, natural gas and water sectors, predicts the demand for refined petroleum products could rise sharply to 112,400 bpd by 2025. 

This expected demand for fuel, along with Tanzania’s desire to reduce both the damage to the road network and the level of emissions from use of fuel tankers led to the decision to construct a new oil pipeline from Dar es Salaam to Ndola in Zambia. Takeoff points will be at Morogoro, Iringa, Njombe, Mbeya na Songwe within Tanzania. 

“Implementation of the new oil pipeline project will enhance security of supply of petroleum products in all provinces (in Tanzania), where the pipeline will pass in addition to creating additional job opportunities,” said David Kalemani, Tanzania’s energy minister. 

He said the new oil pipeline, which is at the feasibility study phase, “will prevent destruction of road infrastructure and ease vehicle congestion in Dar es Salaam.” 

Tanzania has allocated $350,000 in the 2019-20 fiscal year for feasibility studies. The project will be implemented jointly with Zambia, but neither government has firm plans for financing or timelines for completing the project. 

The option of constructing a new pipeline for refined petroleum products has been proposed previously. The thrust of these discussions involved the desire of the two countries to address frequent breakdowns along their jointly owned Tanzania Zambia Mafuta (Tazama) crude oil pipeline, which has a mixed diameter of 8 and 12 inches and is operated by Tazama Pipeline Limited. 

However, Zambia had already announced plans to offload a majority stake in the poorly performing Indeni refinery to a strategic partner, an indication of plans to us to which means the need for a crude oil pipeline will continue to exist. 

By early this year seven bidders had been short-listed for the acquisition of the refinery, including Glencore Energy U.K, Vitol SA, China Petroleum Technology & Development Corporation, Philia Trading, Joint Stock Company Global Security of Russia, Sahara Energy Resources, and consortium of Beijing Huiersanji Green Chem Company Limited and AVIC International Holding. 

The Tazama Pipeline has been characterized by performance failures attributed to lack of scheduled maintenance, external corrosion due to failure of the pipeline coating and the effect of low-resistivity, black-cotton soil and internal corrosion due to persistent incursion of sea water into the pipeline from the single- point mooring (SPM) system offshore Dar es Salaam Harbor. 

At the Dar es Salaam port, the Tazama crude oil pipeline is supported by a 2.3-mile (3.3-km), 36-inch sub-sea pipeline. The SPM, which has a discharge speed of 2,500 cubic meters/hour, is held steady by catenary anchor chains concreted into the sea floor. It can rotate and hold offloading tankers with capacities up to 150,000 deadweight tons. 

Unfortunately, the existing pipeline, at times, records an average of 100 leakages in a year, which has substantially reduced its installed capacity from the initial 1.1 mtpa to slightly more than 600,000 tons/year. 

Tanzania’s proposal for a new oil pipeline comes barely five years after a study by the Channoil Consortium Ltd on the security of supply of petroleum products to Zambia proposed several options, including construction of a new line that would cost more than $1 billion. The consortium consists of PricewaterhouseCoopers, Corpus Legal Practitioners and Channoil Consulting Ltd. 

Another option put forward in the study was the replacement of the existing pipeline with a new 12-inch multi-product pipeline. 

“A multi-product pipeline can transport multiple different oil products sequentially down the pipeline, using batching pigs or interfaces to separate the products,” it said. 

The study also said replacing the existing pipeline would require storage at pump stations in order to develop any of these into distribution centers for gasoline and diesel. 

“The batching pigs or interfaces will contain some mixing of the grades, which can be separated and downgraded as per industry practice,” the study projected. 

Another proposal to supply Zambia was to replace the 605-mile (954-km) Tazama crude pipeline made up of deteriorating 8-inch pipe, as well as the 470 miles (756 km) of 12-inch pipe section with a completely new 12-inch crude only pipeline, while maintaining the pump station configuration but reducing the intermediate pigging stations.

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