The United Republic of Tanzania is a union of two countries, Tanzania Mainland and Tanzania Zanzibar. Ownership of hydrocarbons in Tanzania is vested in the public and managed by the government. Persons interested in engaging in exploration, development and production are required to obtain necessary approvals and permits as provided for under the Petroleum Act, which is the major relevant law. Where such activities are in Tanzania Zanzibar, such permits and approvals will be granted under the laws applicable in Tanzania Zanzibar. The regulatory system is such that approvals and permits for exploration, development and production would exclusively be granted to the national oil company, which is the Tanzania Petroleum Development Corporation (TPDC), which in turn conducts operations through partnerships with interested persons through either an open tendering process or a direct award of a block.

To qualify for a partnership with the TPDC, the participating entities must be registered in Tanzania and demonstrate the required technical knowledge and financial capability. Additionally, when forming a partnership, the TPDC is obligated to maintain a participating interest of at least 25%.

Upon establishment of a partnership, the Minister of Energy, with the advice of the Petroleum Upstream Regulatory Authority (PURA) and approval from the Cabinet, enters into a production sharing agreement with the TPDC and its partners. This production sharing agreement is intended to govern the terms and conditions of the partnership.

The governmental agencies that are mainly responsible for regulating hydrocarbon activities in Tanzania are the Ministry of Energy, which is responsible for, inter alia, formulating and reviewing policies and plans for the sector; granting and renewing petroleum exploration and development licences; entering into agreements on behalf of the government; and initiating inquiries and studies on petroleum activities.

Another regulatory body is PURA, whose key functions include regulating upstream petroleum activities by advising the Minister of Energy on negotiations, promotion and bidding processes for production sharing agreements; granting and renewing licences; advising on proposed development plans by a licence holder; and advising on the decommissioning of installations.

The Energy and Water Utilities Regulatory Authority (EWURA) also exercises regulatory powers in the midstream and downstream sectors. Its functions include granting, refusing, renewing, suspending and revoking licences for entities engaged in midstream and downstream activities; implementing government policies; and determining and enforcing tariffs, rates, charges and fees in respect of midstream and downstream activities.

As mentioned in 1.1 System of Hydrocarbon Ownership, TPDC is Tanzania’s national oil and gas company. It is responsible for managing and overseeing the commercial aspects of petroleum operations in the upstream, midstream and downstream sectors. It also represents the government’s participating interests in petroleum and natural gas agreements. The government maintains 51% shares in the TPDC.

The principal hydrocarbon legislation and regulations related to upstream, midstream and downstream operations encompass the following:

Petroleum Act Cap 392 R.E. 2023

This is the main legislation that sets the legal and regulatory framework for Tanzania’s oil and gas sector. The legislation establishes PURA as the main regulator in upstream activities and acknowledges EWURA as the regulator in midstream and downstream activities. It provides a comprehensive legal and regulatory framework for the exploration, development, production and utilisation of petroleum resources. It also provides for licensing, regulatory authority, environmental protection, health and safety, local content requirements and revenue-sharing mechanisms.

Energy and Water Utilities Regulatory Authority Act (Cap 414 R.E. 2023)

This legislation establishes EWURA, which exercises regulatory powers in the midstream and downstream sectors. It governs licensing, tariffs, rates, charges and fees for entities engaged in midstream and downstream regulated activities.

Oil and Gas Revenue Management Act Cap 328 R.E. 2023

This legislation provides for the management of oil and gas revenues in Tanzania. It outlines principles for revenue collection, allocation, management and reporting, ensuring transparency and accountability.

Natural Wealth and Resources (Permanent Sovereignty) Act Cap 449 R.E. 2023

This legislation affirms Tanzania’s permanent sovereignty over its natural wealth and resources, including oil and gas. It also provides a legal framework for the government to exercise control and ownership over these resources, ensuring their sustainable utilisation for the benefit of the nation and prohibits subjecting matters arising from natural wealth and resources to any foreign court or tribunal.

The Natural Wealth and Resources Contracts (Review and Re-Negotiation of Unconscionable Terms) Act Cap 450 R.E. 2023

This legislation mandates the Government of Tanzania to review and renegotiate or expunge the terms of any contract pertaining to the extraction, exploitation, acquisition and utilisation of natural wealth and resources that are found to jeopardise the interests of the state.

Income Tax Act (Cap 332 R.E. 2023)

The Income Tax Act regulates the taxation of various sources of income in Tanzania, including income generated from oil and gas activities. It sets out the tax obligations, rates and procedures for companies and individuals.

Environmental Management Act Cap 191 R.E. 2023

This legislation provides the legal framework for environmental protection and management in Tanzania, including the oil and gas sector. It establishes stakeholders’ rights and responsibilities in safeguarding the environment, preventing pollution and promoting sustainable development and sets out procedures for environmental impact assessments, permits and enforcement mechanisms to ensure adherence to environmental standards.

The Tanzania Extractive Industries (Transparency and Accountability) Act Cap 447 R.E. 2023

This legislation aims to ensure transparency and accountability in the extractive industries for the benefit of the Tanzanian sector through establishing the Extractive Industries (Transparency and Accountability) Committee.

The Investment and Special Economic Zones Act, Act No 6 of 2025

This legislation aims to provide procedures for investment in Tanzania, including:

attraction, promotion, facilitation and protection of investment in Tanzania;

favourable conditions for investors; and

a framework for the operation of special economic zones.

The Petroleum (Natural Gas Midstream and Downstream) General Regulations, Government Notice No 270 of 2020

These regulations outline the conduct of midstream and downstream natural gas activities, including aspects of the transportation, distribution, storage and sale of natural gas.

Upstream Petroleum Regulatory Authority (Annual Levy, Fees and Charges), Government Notice No 959 of 2019

These regulations outline the annual levy, fees and charges imposed by the Upstream Petroleum Regulatory Authority. The regulations specify the financial obligations for companies operating in the upstream petroleum sector and provide guidelines for calculating and paying these levies, fees and charges.

The Petroleum (Reconnaissance and Tendering) Regulations, Government Notice No 958 of 2019

These regulations govern the procedures and requirements for conducting petroleum exploration and exploitation activities, including the issuance of licences, bidding processes and evaluation criteria.

The Petroleum (Local Content) Regulations, Government Notice No 197 of 2017

These regulations aim to enhance and promote local participation within the petroleum industry. They outline requirements for companies to prioritise local goods, services and employment opportunities in their petroleum activities.

The Petroleum (Natural Gas Pricing) Regulations, Government Notice No 353 of 2020

These regulations establish procedures and methodologies used to calculate and set natural gas prices to ensure fairness, transparency and competitiveness in the pricing process.

The Petroleum General Regulation, Government Notice No 163 of 2011

This regulation provides for the establishment of the Petroleum Supply Technical Committee and compliance specifications, as well as quality control of petroleum products.

The Petroleum (Corporate Integrity Pledge) Regulations, Government Notice No 782 of 2019

These regulations aim at promoting integrity and accountability in the corporate community, reinforce corporate governance and transparency and provide technical assistance for implementing anti-corruption measures by persons carrying out petroleum operations.

The Petroleum (Bulk Procurement) Regulation Government Notice No 198 of 2017

This regulation governs the bulk procurement of petroleum products. It provides for guidelines and procedures for the procurement process, including qualification criteria, bidding processes and evaluation methods.

As explained under 1.1 System of Hydrocarbon Ownership, exclusive rights to explore, develop and produce hydrocarbons are granted to TPDC. The granted rights are not transferable, but TPDC may enter into partnerships with private investors through a production sharing agreement to explore, develop and produce hydrocarbons in Tanzania, provided that it maintains a 25% participating interest in such partnership. This production sharing agreement will, among other things, state the rights of each party, whereas the rights of the TPDC and those of a contracting company will be taken to be joint and several. The TPDC’s specific duties include obtaining the necessary licences for an identified block and renewing them upon expiry. In the production sharing agreement, the transfer or assignment of rights is not allowed unless the Minister provides written consent.

As stated in 2.1 Forms of Private Investment: Upstream, upstream licences are issued only to the TPDC, which can enter into a production sharing agreement with a private investor in Tanzania. The choice of this private investor must be made through an open tendering process which is public and transparent. Accordingly, the production sharing agreement will be concluded only after completion of a competitive public tender. In any case, the Petroleum Act, 2015 allows the Minister for Energy, after being advised by PURA and the Cabinet, to engage in direct negotiations with qualified and eligible companies where the competitive public tendering is not effective. The only difference is the reconnaissance permit, which may be issued directly to any company interested in carrying out a preliminary evaluation of hydrocarbon potential. The licence may be granted for a period of not more than three years.

A major qualification for a private investor to form a partnership with the TPDC is that it must be registered in Tanzania under the Companies Act and must also have technical knowledge and financial capacity. This means that, among other things, a private investor would have to register a subsidiary in Tanzania. Further, the TPDC and the private investor will agree on the financial and bond requirements. For instance, the model production sharing agreement requires a guarantee of a minimum expenditure committed for a certain period or a sum of USD400,000, for the performance of obligations not covered by the former guarantee.

The TPDC, on behalf of the private investor (contractor), is duty bound to pay royalties for itself and on behalf of its contractor following the production area stipulated in the production sharing agreement to the tune of 12.5% for the areas that are onshore/shelf and 7.5% for areas that are offshore, which is calculated out of the gross volume recovered at delivery point before the recovery of costs.

Under the Petroleum Act, 2015, the private investor (contractor) is required to pay a production bonus at the commencement of the project and signature bonuses (a non-recoverable amount payable to the government upon signing the agreement). These bonuses are usually detailed in the production sharing agreement entered into between the TPDC, the government of the United Republic of Tanzania and the contractor.

Tanzania has no separate hydrocarbon income tax regime. The overall taxes governed by the Income Tax Act (Cap 332), Value Added Tax Act (Cap 148) and Stamp Duty Act (Cap 189) will be applicable. Some of these taxes include:

• corporate income tax, which is payable at a rate of 30% per annum;
• withholding tax, which is payable at different rates ranging from 5% to 15% depending on the nature of the service provided;
• value added tax (VAT), which is payable at a rate of 18% per annum. In the case of services procured, it is payable for each service performed in Tanzania. It is noteworthy that VAT is only chargeable by persons registered with the Tanzania Revenue Authority who have obtained a VAT registration number;
• stamp duty, which is payable at a rate of 1%; and
• excise duty and import duty in accordance with the East Africa Community Customs Management Act, 2004.

As pointed out above, TPDC is responsible for managing and overseeing the commercial aspects of petroleum operations in the upstream, midstream and downstream sectors. It is also responsible for representing the participating interests of the government in petroleum and natural gas agreements. It has exclusive mandate over all petroleum rights under the Petroleum Act, 2015.

Local content requirements are set under the Petroleum (Local Content) Regulations of 2017, which require licence holders, contractors, subcontractors and licensees to comply with minimum local content levels set in the First Schedule to the Regulations.

Further, it is a requirement to give preference for utilisation of goods and services that are produced or available in Tanzania and where such goods and services cannot be found locally, the law allows for them to be provided by a foreign company which has entered into a joint venture with a local Tanzanian company, with the latter having 25% interest in the joint venture. Note that pursuant to the Petroleum (Local Content) Regulations of 2017, a local Tanzanian entity is an entity which is either 100% owned by Tanzanian citizens or a foreign-owned entity which has a joint venture with a Tanzanian citizen or company where the Tanzanian citizen’s or company’s participating share is at least 15%.

The Petroleum (Local Content) Regulations of 2017 also set a requirement for the preparation of a local content plan which should be presented to the appropriate authority for approval. The local content plan must provide details of employment and training, succession planning, research, development and innovation, procurement of goods and services, technology transfer, legal services, engineering services, financial services, insurance services and any other details required by the relevant authority.

In Tanzania, development licences are issued to either a holder of an exploration licence or a person who does not hold the exploration licence. If the applicant is a holder of an exploration licence, the licence must still be in force and the blocks must have been declared within two years for crude oil and three years for natural gas. This depends on whether the Minister for Energy is satisfied that the block has a petroleum reservoir. In the case of a person who is not a holder of an exploration licence, the Minister must be satisfied that the respective block contains a petroleum reservoir and it is not a block on which there is an exploration or development licence in place. Either way, the application for a development licence must be accompanied by a development plan showing the proposal for establishing and operating the facilities, processing and transporting the petroleum and adhering to local content through the employment and training of Tanzanians.

Where the Minister has received the application, they shall obtain Cabinet approval before approving the development licence. Where the approval has been obtained, the Minister, after being advised by PURA, will issue a notice to the applicant of the grant of a development licence and require the applicant to accept the proposed development licence within 60 days, failing which the application will lapse.

Upon issuance, the development licence also covers the drilling of production and injection wells. No separate permit is required for drilling activities.

Each upstream licence contains the start date of the licence, identifies the area subject matter of the licence and sets out the conditions upon which the licence has been issued and the conditions and duties of the holder of the licence.

The licensee should apply for an extension of the development licence 12 months before the licence expires. Together with the application, the applicant must show in respect of each development area, work carried out and petroleum recovered. The Minister may accept or refuse the application for extension of a development licence after being advised by PURA and receiving approval from the cabinet. For an exploration licence, the application for extension must be submitted 90 days before the licence expiry date.

The Minister must approve the transfer of interest in upstream licences. To this end, an application for approval must be made to the Minister along with transfer documents, an undertaking that the transferee is capable of discharging the duties that the applicant had, an integrity pledge by the transferee, showing the qualifications of the transferee and its employees and particulars of the financial resources available to the transferee. Even after the application is made, the Minister may approve or refuse the transfer. The TPDC, as the licensee, has a first right of refusal to acquire the rights where the assignment is made to a non-affiliate company.

The transfer may also be subject to antitrust approvals.

The Minister is empowered to approve a production schedule either before or after grant of a development licence and issue an annual production permit. Despite this production schedule, the Minister may, upon application, approve, for a specified time, the quantity of petroleum that may be produced.

In addition, production rates in Tanzania are also stipulated in the production sharing agreement signed between the TPDC, the government of the United Republic of Tanzania and the private investor.

Tanzania is not a member of the Organization of the Petroleum Exporting Countries (OPEC).

The TPDC has exclusive rights over natural gas midstream and downstream activities. Its role is to safeguard the nation’s interest in the natural gas industry and participate in the strategic ownership of natural gas projects and business. In essence, it has exclusive rights to purchase, collect and sell natural gas from producers. It also owns pipeline networks from production areas or gathering stations to wholesale distributors and final consumers. Despite this monopoly, TPDC is also mandated to enter into joint ventures under public-private partnerships and strategic arrangements to implement its duties. It may also, upon application or after a competitive tender, give consent to another person to undertake the regulated activities falling within the midstream and downstream.

Despite the exclusivity described above, other persons may generally participate in midstream and downstream activities, provided they obtain the necessary permits from EWURA.

As noted under 3.1 Forms of Private Investment: Midstream/Downstream, although the TPDC has a monopoly over natural gas midstream and downstream activities, it can enter into joint ventures under public-private partnerships and strategic arrangements in implementing its duties. It can also give consents to other entities to carry out midstream and downstream activities. The rights and terms of access are more contractual insofar as the TPDC issues consents to give such rights.

Midstream/downstream licences are issued by EWURA and exclusive rights are vested with TPDC. However, other persons, apart from TPDC, may be licensed to operate in midstream/downstream if they have received consent from TPDC. In order to obtain the relevant licences, the applicant should apply to EWURA providing details of its name and address, business location, proof of financial and technical capacity, its integrity pledge, local content plan and any other particulars as may be required. Where the applicant is not the TPDC, the applicant has to prove that it obtained consent from the TPDC. Once the application is submitted, EWURA will evaluate it and is required to grant approval within 60 days.

Each major midstream and downstream operator is governed by contracts between itself and the infrastructure owner, marketer and customers. These contractual arrangements are between the contracting parties and it is common to have clauses stating that the contractor should take or pay a certain volume of petroleum equal to an agreed percentage of the annual contract quantity. EWURA, as the regulator, has a legal mandate to monitor petroleum and the prices of petroleum products from time to time. The licensee is obligated to comply with EWURA’s directions.

As with upstream activities, no specific taxation regime applies only to downstream and midstream activities. The taxes explained under 2.4 Income or Profits Tax Regime: Upstream also apply here.

As pointed out under 3.1 Forms of Private Investment: Midstream/Downstream, the TPDC enjoys the following rights over natural gas midstream and downstream activities: right to safeguard the nation’s interest in the natural gas industry and participate in the strategic ownership of natural gas projects and business; the right to purchase, collect and sell natural gas from producers; and the right to own pipeline networks from production areas or gathering stations to wholesale distributors and final consumers.

There is no different local content requirement for midstream and downstream operations. The requirements explained under 2.6 Local Content Requirements: Upstream are applicable.

The general conditions on the licences may include the following:

• restriction of activities allowed to be carried out by the licensee;
• requirement to furnish certain information periodically;
• requirement for compliance with directions or determinations as may be issued by EWURA;
• requirement to serve EWURA with reports as may be specified;
• requirement to have a place of business in Tanzania; and
• any other condition as may be specified by EWURA.

Specifically for transportation, the licensee may be required to enter into an arrangement with any person for conveyance of gas through a pipeline and third-party access and to follow procedures when dealing with a public emergency requiring maintenance of a gas supply system. For a distribution licence, the licence may include conditions requiring the licensee to ensure a safe, reliable and affordable supply of gas to users and terms regarding the prices to be charged and the methods for determining the charge.

A licensee has domain rights to infrastructure on which it operates or which it maintains. However, the law gives EWURA a supervisory power to carry out inspections and monitoring to ensure that the investor that has obtained a licence is acting in accordance with the requirements of the law.

EWURA governs hydrocarbon transportation under the Petroleum (Natural Gas) (Midstream and Downstream) Regulations. This requires obtaining a licence from EWURA to carry out transportation activities. There is no different treatment between intra- and interstate pipelines. The benefit of intrastate pipelines is the higher likelihood of negotiating with the neighbouring country’s regulatory authority and government to obtain waivers and duty exemptions for the transportation to be carried out.

The requirements for a transportation licence (see 3.8 Other Key Terms: Midstream/Downstream) require that access be granted to third parties over an infrastructure. As such, the licensee may be required to enter into arrangements with any person for conveyance of gas through the infrastructure it maintains – eg, a pipeline. The law does not prohibit providing services to multiple segments in the market.

There is no restriction on selling products into the local market. As long as one is licensed, they have the right to sell the products in adherence to the directions that may be issued by EWURA, such as directives on the prices of the goods. The intermediary will only be available when purchasing products from a foreign entity,, where the Petroleum Bulky Procurement Agency will be mandated to make all procurements on behalf of the licensee for sale in the local market.

The export of crude oil, natural gas and petroleum products is regulated by the Petroleum Natural Gas (Midstream and Downstream) Regulations, which require any export to be made after obtaining approval from EWURA. Importation is also regulated by the Executive Agencies (The Petroleum Bulk Procurement Agency) (Establishment) Order, 2015 which establishes the Petroleum Bulky Procurement Agency together with the East African Customs Management Act, 2004.

The transfer of operations and assets between private parties can be done through private agreements subject to necessary approvals from the Minister, EWURA and where needed the Fair Competition Commission (FCC). Antitrust approval becomes necessary where the transfer of operations is likely to trigger a direct or indirect change of control on the owner and/or the transaction meets a threshold for notification, which is TZS3.5 billion (approximately USD1.4 million), calculated based on the combined market value of assets or turnover of the transacting parties.

Investments are primarily governed by the Investment and Special Economic Zones Act (ISEZ Act, 2025), which aims to create favourable conditions for investment through the Tanzania Investment and Special Economic Zones Authority (TISEZA), which promotes and facilitates investment in Tanzania. The ISEZ Act, 2025 repealed the Tanzania Investment Act, which governed investments in Tanzania and included provisions to facilitate investments in special economic zones.

The ISEZ Act, 2025 does not apply to business enterprises:

• authorised to conduct exploration or production operations; or
• authorised to construct or operate a pipeline under the Petroleum Act; or
• seeking authorisation to conduct any such operations.
• Nonetheless, the Act requires TISEZA to assist all investors regardless of their form of investment.

The Investment and Special Economic Zones Regulations, 2025 are also now in force and should be read together with the ISEZ Act. They provide detailed rules on investor registration, certificates of investment, strategic investment applications, SEZ licensing, incentives, monitoring, reporting, fees and appeals.

Notwithstanding the above, strategic investments in oil and gas are eligible for applicable incentives and benefits, including exemptions on tolls and taxes. For instance, the Petroleum Act allows the Minister to ensure that the gas pricing structure provides incentives for promoting investment while sustaining supply and demand for natural gas.

There are currently no sanctions in place for investments in oil and gas. Tanzania continues to attract a plethora of investment in the oil and gas sector with several pieces of legislation targeted at attracting such investment.

Recent amendments to the Natural Wealth and Resources (Permanent Sovereignty) Act, the Natural Wealth and Resources Contracts (Review and Re-Negotiation of Unconscionable Terms) Act and the Petroleum Act mean investors that are transporting natural wealth and resources not exploited in Tanzania under a special arrangement that has been approved by the Cabinet will not need to comply with the Act. Therefore, such investors have lower compliance requirements. Under the Petroleum Act, foreign investors with special arrangements approved by the Cabinet shall not be prejudiced by provisions relating to revocation or suspension of an approval from EWURA, licensing application for midstream and downstream activities, monitoring of petroleum and petroleum product pricing, integrity pledge requirements, among others, which allows for investors under special arrangements to structure their investments in a manner that is not burdened by the provisions excluded following these amendments.

Investors are also encouraged by the new Tanzania Investment Act provisions related to guarantees in transfer of capital, profits and dividends or the guarantee against nationalisation or expropriation.

The Environment Management Act No 20 of 2004 is the principal legislation for environmental issues in Tanzania, including in oil and gas operations. This law is supplemented by the Petroleum Act No 21 of 2015, which is the principal law governing upstream, midstream and downstream operations and sets out the general environmental principles and liabilities that apply to such operations in Tanzania mainland and Zanzibar.

Both the National Environment Management Council (NEMC), PURA and EWURA are mandated under the Environment Management Act and the Petroleum Act, respectively, to act as environmental regulators jointly and in consultation, even though NEMC remains the principal regulator. NEMC works in collaboration with EWURA to establish environmental standards for petroleum operations.

As the principal environmental regulator, NEMC is responsible for determining whether a petroleum activity or project is likely to have an adverse impact on the environment, including through environmental impact assessment certificates, environmental audits and monitoring, enforcement of national environmental quality standards and imposition of fines or remedial measures for non-compliance. In the petroleum sector, NEMC works in consultation with the relevant petroleum regulators. PURA regulates and monitors upstream petroleum operations, including exploration, development and production activities. EWURA regulates midstream and downstream petroleum and natural gas activities and is mandated to prescribe licence terms and conditions relating to management, transportation, storage, treatment or disposal of waste arising from petroleum activities and to impose penalties for non-compliance.

Environmental Impact Assessment (EIA) Certificate

Prior to the development of any major hydrocarbon project, an environmental and social impact assessment study must be undertaken and, upon approval, the project developer will be issued an environmental and social impact assessment certificate. The project developer must commission experts registered by the NEMC. Briefly, the process has been outlined below.

• The proposed project must be registered with the NEMC by submitting the application for registration form together with the prescribed application fee.
• The application form and project brief are submitted to the NEMC for screening and the NEMC must issue its approval of the screening report within 45 days from the date of submission.
• The project investor must then engage an environmental expert or consultant to prepare a scoping report and terms of reference for conducting the EIA. These items must then be submitted to the NEMC for review and approval before commencing the EIA study. The NEMC has a period of 14 days to issue its approval. Oil and gas projects are generally considered type A projects and therefore the supporting project scoping report for a type A project must state the following during submission to the NEMC for its review:
1. the nature of the project;
2. the proof of land ownership, including location of the project and the physical area that may be affected by the project’s activities;
3. the activities that shall be undertaken during the project construction, operation and decommissioning phases;
4. the design of the project;
5. a site layout plan;
6. the materials to be used and their source, products and by-products, including waste to be generated by the project and the methods of their management;
7. the potential environmental impacts of the project and the mitigation measures to be taken during and after implementation of the project;
8. an action plan to ensure the health and safety of the workers and neighbouring communities during the project;
9. a declaration that the proposed project is not within or near a sensitive ecosystem;
10. an Environmental and Social Management Plan (ESMP) and Monitoring Plan;
11. the economic and socio-cultural impacts to the local community and the nation in general;
12. the project budget;
13. how the scoping exercise was undertaken;
14. identification of issues and problems;
15. synthesis of results of the scoping exercise, including details of potential negative and positive impacts;
16. stakeholder groups identified and how they were involved in the scoping exercise;
17. spatial, temporal and institutional boundaries of the project;
18. project alternatives; and
19. any other relevant information which the NEMC may require.
• The EIA process should now be read together with the Environmental Impact Assessment and Audit (Amendment) Regulations, 2024, which require climate impacts, vulnerability assessments and climate change mitigation and adaptation measures to be considered throughout project decision-making. The assessment should also cover both the project’s impacts on the environment and climate, as well as the project’s vulnerability to current and future climate risks, including the need for climate-resilient infrastructure and the project’s long-term viability in light of those risks.
• Upon approval from the NEMC, the consultant must conduct an EIA study in accordance with the approved terms of reference. The time taken to carry out the EIA study will be determined on a case-by-case basis as it depends on the type and complexity of the individual project.
• The environmental impact statement or EIA report or Environmental Management Plan (EMP), together with the EIA submission form, are then submitted to the NEMC for review, which will include a review by key stakeholders as well as the cross-sectoral Technical Advisory Committee. The review consists of site visits and confirmation of stakeholder consultations within 60 days of submission of the environmental impact statement.
• The consultant will improve the environmental impact statement by incorporating comments and recommendations raised before submitting a final version to the NEMC for final scrutiny.
• The NEMC shall then forward the recommendations to the Minister for Environment for final decision.
• Within a period of 14–30 days, the Minister may approve or disapprove the environmental impact statement. Where an approval is issued, the signed EIA certificate will be delivered to the NEMC for collection by the project developer.

Environmental Audit

This allows the NEMC to determine the progress of activities and whether a project’s processes or undertakings conform to the approved environmental and social management plan and quality standards. Through this process, the NEMC also evaluates ways to refine implementation procedures or undertakings to further mitigate adverse environmental impacts, as well as to check compliance with the plans that are part of the EIA. An environmental audit must be undertaken within 12 months after an EIA and commencement of a project or not more than 24 months after completion of a project, whichever is earlier. The process is as follows:

• A qualified and authorised environmental auditor is appointed to ensure the appraisal considers whether adequate environmental regulatory frameworks and sustainable use of natural resources were in place, among other factors.
• The proposed project is registered with the NEMC by submitting an application for an environmental audit certificate together with the prescribed application fee.
• The terms of reference are approved by the NEMC, as the audit must be conducted in accordance with the terms of reference developed by the developer in consultation with the NEMC. This means submitting the application form together with copies of the project brief and terms of reference for review by the NEMC within a period of 14 days.
• The environmental auditor or consultant shall conduct an environmental audit study in accordance with the approved terms of reference and relevant legislation.
• The environmental audit report produced by the auditor must then be submitted to the NEMC for review, which entails physical inspection and stakeholder consultations. The NEMC shall undertake the review within 60 days of submission of the environmental audit report.
• The environmental auditor or consultant must then make improvements to the report by incorporating all comments from the NEMC and the technical advisory committee.
• The final version of the environmental audit report must then be submitted to the NEMC for final scrutiny and, upon confirmation, the NEMC will then forward it to the Minister for Environment for final approval.
• Upon approval, the Minister shall sign the certificate and forward it to the NEMC for collection by the project developer or, upon disapproval, the Minister shall notify the NEMC. The approval or disapproval by the Minister shall be delivered within 30 days.

Occupational Health and Safety Act

This Act requires all workplace premises to be inspected and registered by the Occupational Health and Safety Authority to ensure safety, health and welfare of persons at work.

There is no different EHS requirement for offshore developments. The requirements explained under 5.2 Environmental Obligations for a Major Hydrocarbon Project are applicable.

All oil and gas operations must have a decommissioning plan in place. The decommissioning plan must contain the following:

• proposals for continued production or shutdown of production (in the case of upstream activities);
• decommissioning facilities; and
• information and evaluations considered necessary for the authority to make a direction.

For upstream activities, the decommissioning plan must be submitted to PURA, while for midstream and downstream activities, it must be submitted to EWURA. In both cases, the decommissioning plan must be submitted before the licence expires, is surrendered or the use of the facility is permanently terminated. For upstream activities, the decommissioning plan must be submitted to PURA at least five years before the use of the facility is expected to be terminated permanently, unless PURA directs otherwise. Whereas for downstream activities, it must be submitted within two to four years before the time when the use of a facility is expected to be terminated permanently. Upon submission of the plan, PURA and EWURA may require additional information, undertake further evaluations or require a new or amended decommissioning plan and the licensee must respond within the requested period or within a reasonable time specified in the regulator’s request.

While the law does not specify a bond, a licensee is required to make payment to the decommissioning fund, which shall be applied to the implementation of activities approved in the decommissioning plan. The Petroleum Act provides that a decommissioning fund shall be established for each development area or such other facilities operating in relation to a licence. Upstream activities require the amount deposited in the decommissioning fund to be a portion of the estimated future cost for decommissioning of facilities. In contrast, EWURA – in consultation with other relevant authorities – shall determine the amount to be deposited into a decommissioning fund for downstream activities.

Tanzania still has no standalone climate change statute. However, the Environmental Management (Amendment) Act, 2025 has now introduced a more formal climate change framework within the Environmental Management Act. Accordingly, Tanzania’s climate change framework should now be described as being anchored in the Environmental Management Act, as amended and supplemented by sector-specific laws, policies, strategies, guidelines and regulations.

The 2025 amendments introduced statutory definitions and obligations relating to climate change, climate change management, emissions, energy transition, greenhouse gases and climate change vulnerability assessment. They also established the National Carbon Monitoring Centre (NCMC), whose functions include:

• co-ordinating carbon and greenhouse gas matters;
• registering carbon projects;
• verifying and certifying carbon and greenhouse gas credits;
• managing carbon trading transactions; and
• establishing a greenhouse gas monitoring, reporting and verification system.

In addition to these amendments, other key initiatives targeting climate change are as follows.

• The National Climate Change Response Strategy 2021–2026 acts as a guide to the country on climate change issues and integrating it into sector policies and plans. The Strategy provides a set of adaptation and mitigation interventions, which are expected to strengthen the country’s resilience to the impacts of climate change and contribute to global efforts to reduce greenhouse gas emissions. Relevant to the oil and gas industry are the targets in the energy and industry sector, which include:
1. developing a less carbon-intensive and climate change-resilient energy infrastructure;
2. building a diversified and resilient industrial sector by promoting alternative and renewable energy sources; and
3. enhancing climate-related assessments for industrial development.
• The National Environmental Master Plan for Strategic Interventions (2022–2032) intends to initiate strategic interventions to address climate and environmental challenges, including promoting alternative sources of energy for cooking, such as liquefied petroleum gas and natural gas, to minimise deforestation.
• The National Environmental Policy seeks to provide the framework for making fundamental changes that are needed to bring environmental considerations into the mainstream of decision-making in Tanzania. The policy objective in terms of energy includes promoting sustainable renewable energy resources, assessment and control of development and use of energy and energy efficiency and conservation. In terms of industry, the policy objectives include planning industries in a manner that minimises adverse effects on the environment at all stages; industrial emission control; EIA as an essential element in planning; and environmental audits as essential to pollution control and waste minimisation, among others.
• The National Energy Policy promotes the development and use of renewable energy sources in Tanzania, aiming to reduce reliance on fossil fuels and mitigate greenhouse gas emissions. The policy aims to promote energy efficiency and conservation across all sectors of the economy. For the petroleum and gas sub-sector, the policy aims to optimise and effectively manage the petroleum resource base and cross-cutting issues, such as ensuring compliance with health, safety and environmental standards in the energy sector by promoting best practices, including the “polluter pays” principle.
• The National Strategy for Reduced Emissions from Deforestation and Forest Degradation positions forestry-related activities as a key climate change mitigation measure by acting as sinks and sources of carbon dioxide. In the context of petroleum and gas, the policy aims to engage key stakeholders, including the private sector, in reducing emissions related to deforestation and forest degradation.
• The National Carbon Trade Guidelines 2022 address the demands of carbon trading in Tanzania. These guidelines cover the energy, transport, waste management, forestry, agriculture, industrial processes and product use and other land use sectors. The guidelines aim to enhance the country’s contribution to greenhouse gas emissions reduction efforts, ensuring environmental conservation and climate sustainability as required by the United Nations Framework Convention on Climate Change of 1992, the Kyoto Protocol of 1997 and the Paris Agreement of 2015.
• The Petroleum Act provides the legal framework for upstream, midstream and downstream petroleum activities, including exploration, development and production of petroleum resources. It sets out general environmental protection provisions that indirectly touch on climate change.
• The Environment Management Act and the Environmental Management (Fees and Charges) Regulations provide for fees for environmental quality standards, including fees that must be paid for emission and discharge permits. The fees payable are categorised by polluting activities that are less than 25%, between 25%–50% and greater than 50% of the allowable standards. Fees are also payable for persons who import or export ozone-depleting substances.
• The Environmental Management (Control and Management of Carbon Trading) Regulations detail the requirements and compliance that apply to persons engaging in carbon trading projects or programmes. Such projects must be registered and obtain the requisite endorsements for these activities.

Local governments in Tanzania have minimal influence or input in decision-making processes related to oil and gas development within their regions. Local governments’ key input in the oil and gas development sector is the consideration and approval of a licensee’s corporate and social responsibility plan, which must take into account the local government priorities of the host community. A local government is also responsible for preparing guidelines for corporate social responsibility within their respective localities, overseeing implementation of the plan and providing overall awareness to the public on such developments. Additionally, efforts are deployed to build the capacity of local government authorities to monitor the implementation of climate change sustainability and environmental conservation programmes that may interlink with oil and gas development.

From an environmental perspective, the local government must appoint a local government environment officer and participate in the following capacities:

• project registration and screening steps for an EIA application by providing comments to the project brief;
• where appropriate, participate as part of the cross-sectorial technical advisory committee at local government authority level to advise on reviews of EIA-related reports;
• review and comment on where a developer decides to change its development or undertaking;
• exercise the duty to collect fees and charges payable under the Environmental Management (Fees and Charges) Regulations; and
• notably, the NEMC may also delegate performance of any of its functions or duties to the local government.

For coastal oil and gas infrastructure, local government authorities also have responsibilities under the Integrated Coastal Zone Management Regulations, 2024, including preparing and implementing local integrated coastal zone management plans, public awareness, local capacity building and coordination with regional and national environmental authorities.

The shift towards sustainable energy sources and broader energy transition initiatives has increasingly influenced Tanzania’s energy policy framework, although planning, development and use of oil and gas infrastructure in the upstream and midstream sectors remain largely driven by the country’s objective of monetising its substantial natural gas resources. Tanzania continues to regard natural gas as a transition fuel capable of supporting industrialisation, electricity generation and energy security while facilitating a gradual shift towards lower-carbon energy sources through utilisation of LNG projects. Through the 2026/2027 budget, the Government has proposed various tax incentives, such as VAT and excise duty exemptions on the entire CNG production chain, vehicle conversion equipment and specialised distribution infrastructure. VAT exemptions on LPG tanks, cooking gas cylinders and the importation of raw materials used to manufacture gas cylinders have also been proposed, as in the CNG distribution network.

A significant development has been the adoption and operationalisation of the National Renewable Energy Strategy (2024–2034), which establishes a comprehensive framework for expanding renewable energy deployment in Tanzania. The Strategy sets ambitious targets for solar, wind, geothermal, hydropower and biomass development and envisages the introduction of regulatory frameworks for e-mobility, renewable-powered cooking solutions and the assessment of green hydrogen opportunities. The Strategy also aims to strengthen legal and institutional frameworks for renewable energy investment and to promote greater private sector participation in the renewable energy sector.

Additionally, the strategy aims to harness abundant renewable energy resources to improve access to reliable energy and strengthen the legal and institutional frameworks that support renewable energy investment and development. In addition, the Government has continued to prioritise investment in both power and natural gas infrastructure. The Ministry of Energy’s 2026/27 budget allocates substantial resources to the expansion of electricity generation, transmission and gas infrastructure, reaffirming the country’s dual-track approach of promoting renewable energy while simultaneously developing its natural gas resources.

Although Tanzania’s energy transition agenda aligns with global climate action commitments, the need to utilise its abundant natural gas resources for economic development continues to place the country at a strategic crossroads. The Government has consistently emphasised that natural gas will play a central role in Tanzania’s energy transition and industrialisation agenda.

The development of the country’s LNG project has gained renewed momentum, with negotiations on the Host Government Agreement (HGA) and associated project agreements reaching advanced stages and undergoing final legal review. The proposed LNG project, estimated at approximately USD42 billion, remains one of the largest anticipated investments in the country’s history and is expected to significantly enhance Tanzania’s position as a regional energy hub.

Notwithstanding these developments, the repurposing of oil and gas assets to support low-carbon technologies such as carbon capture, utilisation and storage (CCUS), hydrogen transportation and other decarbonisation initiatives remains relatively undeveloped. Additionally, reporting on concrete actions taken by upstream and midstream operators to reduce greenhouse gas emissions during operations beyond NEMC regulatory requirements remains limited.

Considering that Tanzania has decided to tap into carbon trading as a broader solution to reduce emissions, the link between the regulatory framework of carbon trading and the oil and gas sector remains underexplored as a viable opportunity for energy transition. For example, the sector could use existing pipelines to transport captured carbon dioxide for carbon capture, utilisation and storage (CCUS) or hydrogen for clean energy as part of the carbon trading project.

As global priorities shift toward renewable energy, Tanzania may face setbacks in attracting large-scale oil and gas project financiers, which could limit exploration and sector development. However, there are opportunities to integrate current environmental and social responsibility practices to maintain interest in traditional oil and gas sector development. Over the next several years, the authors expect to see a collaborative approach to limit the negative impact on sector development. For example, LNG export development has been Tanzania’s long-term focus. However, its long-term viability is expected to come under scrutiny due to the global push towards cleaner energy. On the other hand, Tanzania has set a target for 80% of households to adopt clean cooking methods by 2032. Although these two projects are relatively unconnected, their simultaneous development ensures a balanced approach to sector development.

Tanzania does not have a specific law for unconventional upstream interests such as shale, heavy oil and coal-bed methane. Nonetheless, the Petroleum Act 2015 and its regulations would apply to any upstream development of unconventional upstream interests, as they do to other upstream interests. Similarly, all contractual arrangements would be guided by the model production sharing agreements developed by PURA or any other model agreement, albeit subject to approval by the Cabinet.

The Petroleum Act of 2015 is the primary legislation for LNG projects and provides the foundational framework for the sector. Other than that, no specific laws and regulations pertain directly to the development of upstream gas reserves.

In midstream and downstream activities, LNG projects are guided by specific regulations such as the Petroleum (Natural Gas Midstream and Downstream) General Regulations, Government Notice No 270 of 2020, which provide guidelines for the transportation, distribution, storage and sale of natural gas. Additionally, the Petroleum (Natural Gas Pricing) Regulations, Government Notice No 353 of 2020, establish procedures and methodologies for calculating and setting natural gas prices, ensuring fairness, transparency and competitiveness in the pricing process.

Recent developments indicate renewed progress in the implementation of Tanzania’s long-awaited LNG project. Negotiations on the Host Government Agreement and related project documentation have reached advanced stages and are currently undergoing final legal review prior to execution. The proposed LNG project remains a strategic priority for the Government and is expected to unlock substantial investment and export opportunities.

Tanzania continues not to provide specific incentives exclusively applicable to upstream LNG activities. However, investors may benefit from general investment incentives available under the Investment and Special Economic Zones legal framework, subject to satisfying the applicable eligibility requirements.

Tanzania is endowed with vast natural gas reserves, with a staggering 57.25 trillion standard cubic feet (TCF), according to the Ministry of Energy. Recently, the Tanzanian government took a significant step toward exporting its vast offshore gas deposits, announcing it expected to sign a host government agreement and a production sharing agreement with two foreign oil and gas companies to build an LNG export terminal. This terminal will facilitate the export of natural gas.

In recent years, Tanzania has also intensified efforts to expand the use of natural gas in electricity generation, transportation and industrial applications. At the same time, the Government is pursuing an energy transition strategy that recognises natural gas as a transition fuel while simultaneously promoting renewable energy development through the National Renewable Energy Strategy (2024–2034). These developments continue to create significant investment opportunities for private sector participants across the energy value chain.

The oil and gas law and regulation in Tanzania have largely remained unchanged over the past year. However, some developments have impacted investments in Tanzania, including the hydrocarbon industry. The most notable development is the enactment of the Investment and Special Economic Zones Act, 2025 (ISEZ Act), which came into operation on 1 July 2025. The Act repealed the Tanzania Investment Act, the Export Processing Zones Act and the Special Economic Zones Act and established the Tanzania Investment and Special Economic Zones Authority (TISEZA) as a unified investment facilitation agency. The new framework aims to streamline investment procedures, establish a digital one-stop investment centre and improve the overall investment climate. The Investment and Special Economic Zones Regulations, 2025 have further operationalised the new regime.

In addition, the Environmental Management (Control and Management of Carbon Trading) Regulations, 2022 remain in force and continue to provide the legal framework for the registration and implementation of carbon trading projects in Tanzania. The regulations are increasingly relevant to the hydrocarbon industry, particularly as companies explore opportunities relating to emissions reductions, carbon offsets and other decarbonisation initiatives.