We acknowledge that this ensures we retain the goodwill of our hosts and a license to operate our business. We recognise the privilege it is to operate in Tanzania, but also the centrality of the environment and its extraordinary ecological systems to the livelihoods of many of the Tanzanian people. As such, we engage regularly with a broad range of stakeholders on environmental matters, from international organisations to locals in the communities in which we operate.
We also invest considerable time and effort in formal reporting, auditing and updating internal controls and regulations, and consulting with communities to ensure their and the nation’s best interest are protected alongside the Company’s reputation. We recognise the impact of the business on the environment and undertake environmental impact assessments when commencing capital projects.
The quest for global reduction in GHG emissions places pressure on emerging economies, where a high proportion of economic activity is based on extractive and carbon intensive industries. At the same time, African economies have very low historic and current emissions per capita and low access to electricity. This conundrum places countries like Tanzania at a crossroads between the need for development and action on climate change mitigation.
The development versus climate debate often ignores the role that gas can and needs to play as a lower-emissions alternative to traditional fossil fuels in developing countries, and also misses the opportunity to foster a market for carbon-neutral or Liquid Natural Gas. As such, we believe that our business is vital in assisting Tanzania in its development goals while also advancing towards a lower carbon economy.
The Tanzanian government has pledged to:
As a natural gas producer and operator, we are exposed to both physical and transitional climate change risks, while we acknowledge that our operations have the potential to exacerbate these risks over the long term.
We utilise a third-party 207km onshore pipeline that transports gas from Songo Songo Island to Dar es Salaam. We also operate a 50km downstream high and low pressure gas distribution network. However, the vast majority of all pipelines are buried and protected in vulnerable areas.
Thus they are not particularly exposed to climate change induced extreme weather events. Other physical infrastructure such as offshore and onshore wells may be more vulnerable to extreme weather events.
Since Tanzania’s five-year development plan references the need to “strengthen the availability of natural gas by enhancing petroleum exploration and development activities”, the Company is unlikely to be impacted by this risk directly.
Nevertheless, sentiment around fossil fuels generally is changing and there is a risk of losing access to financing if the Company fails to demonstrate how it is working towards alignment with a low-carbon economy. As such, we want to ensure that we are transparent about our impact and contribution.
We continuously seek and examine opportunities partner local organisations in research directed at innovative solutions around the climate related impacts of natural gas. Similarly, in the future we may investigate options to produce LPG, small scale LNG and increased volumes of CNG alongside our existing gas production operations.
While this would not reduce the amount of natural gas that we produce, it could lead to reduction in the amount of CO2 produced by more efficiently utilising more of the gas’s raw composition. This would reduce reducing the amount of gas we currently flare whilst also further reducing Tanzania’s reliance on coal and imported products.
We are committed to further measure and improve our reporting of our GHG emissions during the next reporting year.