Overview of the Extractive Industries

Tanzania is endowed with a variety of mineral resources, natural gas deposits, and some oil traces. Tanzanian minerals include gold, diamonds and various gemstones. Production of gold (which accounted for 44% of the value of exports in 2007) and diamonds has been climbing steeply since the late 1990s. There are large proven reserves of natural gas in Tanzania and prospects for oil discovery are promising, with a number of searches at advanced stages.

Status of EITI Implementation

Tanzania was accepted as an EITI candidate country on 16 February 2009. Tanzania has until 15 May 2011 to undertake validation. A Memorandum of Understanding between the Government and the multi-stakeholder group was signed on 10 March 2010.

On Friday 11 February 2011 the Tanzania EITI multi-stakeholder group launched the first EITI report that discloses payments made by the major mining and gas operating companies to government for the period of July 1, 2008 to June 30, 2009. The report showed that mining companies reported having paid US$84.4m in 2008/09. However, government entities reported having received only US$48.3m. The reconciler of the EITI report, Hart Group and BDO East Africa, notes that the unresolved discrepancies of US$36.5m might be explained by a number of factors and sets out a clear set of recommendations for future reports.

The validation report was received on 14 May 2011. On 16 August 2011, the international EITI Board declared that Tanzania had made “meaningful progress” in its implementations of the EITI. They set out the following the following corrective actions needed in order for Tanzania to achieve compliance:

1. The MSG should agree a clear definition of “material payments and revenues” and incorporate this definition into the reporting templates and reconciliation process for the second EITI Report (indicator 9). This should specifically address the question of the participation of small companies and payments by companies to local government authorities.
2. The second EITI Report should clearly demonstrate that entities that make or receive material payments are participating in the reporting process (requirement 11).
3. As per the Indicator Assessment Tool for Indicator 13, the government and MSG should take steps to ensure that government disclosures to the reconciler are based on audited accounts to international standards and agree a strategy for addressing these issues in accordance with the requirements as specified in Validation IAT 13.
4. In accordance with the agreed definition of materiality (see point 1, above), the MSG should ensure that all material oil, gas and mining payments by companies to government are disclosed to the reconciler and incorporated into the second EITI Report (indicator 14).
5. In accordance with the agreed definition of materiality (see point 1, above), the MSG should ensure that all material oil, gas and mining revenues received by the government are disclosed to the reconciler and incorporated into the second EITI Report (indicator 15).

The Board agreed that Tanzania will have its candidacy renewed for 18 months (i.e. until 15 February 2013), by the end of which it must have completed a Validation that demonstrates compliance with the 2011 edition of the EITI rules, including requirement 5(e) regarding regular and timely reporting.

Governance of EITI Implementation

The Minister of Energy and Minerals, Hon William Mganga Ngeleja MP, leads the EITI process in Tanzania. On 17 November 2009, the Deputy Minister of Energy and Minerals officially inaugurated Tanzania’s EITI Multi-Stakeholder Working Group. The Group consists of five members each from government, companies, and civil society, plus a chairperson, Judge Mark Bomani.

Tanzania EITI Chairperson

Judge Mark Bomani has been appointed Chair of the TEITI working group.

Tanzania EITI National Coordinator

Mr Benedict Mushingwe
Email: teitiextractiveindustries [at] yahoo [dot] com

Companies operating*

Oil & gas companies: Petrobras*, Shell*, Statoil*, Heritage Oil, Maurel & Prom, Aminex, Tullow Oil

Mining companies: Anglo American*, AngloGold Ashanti*, Barrick Gold*, Xstrata*, Iamgold, Resolute Mining, IMX, BHP Billition*
* EITI Supporting Company

* Note: Company list based on EITI research and is not conclusive

For further information, please contact the Focal Point, or Eddie Rich in the EITI International Secretariat.