ZANZIBAR AND SHELL

                                                                                                                                                                                                        ZANZIBAR AND SHELL SIGN M. O. U

 

The largest European oil producer, Royal Dutch Shell plc (“Shell”) and the Revolutionary Government of Zanzibar have signed a Memorandum of Understanding (MoU) on exploitation of gas and oil recently discovered in the Isles.
The MOU describes in particular the initial activities related to Oil and Gas capacity building and Youth Development activities supporting the development of skills amongst Youth, including educational initiatives and entrepreneurial skills and capabilities.
Shell holds at least four exploration licenses off Zanzibar and is working with Petroleo Brasileiro SA (PETR4), according to Tanzania Petroleum Development Corp.
Shell’s representative in Zanzibar Axel Knospe said they are committed to a strong relationship with Zanzibar and when appropriate, to start undertaking exploration activities in a sustainable, economically, socially and environmentally responsible way.
On his part Minister for Land, Housing, Water and Energy of the Revolutionary Government of Zanzibar Ramadhani Abdalla Shaaban said that the signing of the MoU is a “big step in the right direction” towards the Government’s efforts in developing the energy sector in Zanzibar.
Analysts in the oil and gas sector would likely view this as a significant move since it’s a shift from the past when the Hague-based company had to put some exploration activities in the Zanzibar waters over political debates in the Zanzibar House of Representatives.
Currently, Zanzibar President Ali Mohamed Shein is on official tour in Netherlands and is said to have visited the company yesterday morning.
Shell has said in the past that the agreement between Tanzania mainland and Zanzibar on managing oil and gas resources would allow the company to advance exploration in the Indian Ocean.
President Jakaya Kikwete and Zanzibar President Ali Mohamed Shein last year agreed to begin preparations for the management of oil and gas resources, Tanzania are reported late last year.
Experts said in the past that the problem comes up when it relates to investing in Zanzibar or within its territorial waters, where Zanzibar authorities want a separate agreement with investors, whereas the latter want a single agreement covering Tanzania as a whole.