Every concession has two moments that matter. The signing, which everyone photographs, and the expiry, which almost nobody plans for. Songo Songo, the offshore field that has fed gas to Dar es Salaam’s power plants and factories for more than two decades, has now reached the second moment, and how it ends will be read well beyond Kilwa.
The Songo Songo Development Licence was granted in 2001 for 25 years and expires on 10 October, together with the gas supply contracts attached to it. Orca Energy agreed in April to sell its entire Tanzanian business for $10 to Taifa Gas Tanzania, taking 49 percent, and Amber Energy Investment, a UAE-registered company taking 51 percent.
Orca’s shareholders approved the sale in June, but competition clearance, ministerial approval, stock exchange acceptance and the release of IFC guarantees were still outstanding. Orca has told its market that if the deal does not close in time, operations will cease and the transition will be managed with TPDC and the regulators.
Orca’s subsidiaries also filed three arbitrations at ICSID in August 2025 against the government and TPDC, alleging, among other things, failures in the licence extension process. Orca values the project at about $1.2 billion; damages have yet to be quantified.
There are three ways to read this.
The first is the price. A $10 price tag sounds like a giveaway until you read the documents. Orca’s own disclosures state that the fixed assets become TPDC’s property when the licence expires, and that after closing Orca keeps no interest in the outcome of either the extension or the arbitrations.
The buyers are therefore acquiring two things: a seat at the table for the next licence, and a live claim against the very government they must negotiate it with.
Its real value will be set not by buyer and seller but by the state, through the renewal terms it offers. I press this point on every client who looks at a mature asset in this region: you are not buying reserves, you are buying the remaining tenure and the probability of an extension, and the two must be priced separately.
The second is ownership. Greater Tanzanian participation in a strategic gas asset is a legitimate policy objective. At the same time, the majority holder is a UAE vehicle whose beneficial owners have not been publicly disclosed. Tanzania already has beneficial ownership disclosure rules for companies and for extractive licence holders, and applying them visibly here would protect the buyers’ standing as much as the public interest. Transparency is part of what makes a strategic asset financeable.
The third is continuity, the question that matters most to a factory owner in Mikocheni. Songo Songo delivered an average of about 72 million cubic feet of gas a day last year, more than 70 percent of it to power generation, through a 207 kilometre onshore pipeline to Dar es Salaam. Whether the field is run after 10 October by the new consortium, by TPDC directly or under an interim arrangement, the gas has to keep flowing.
This is not the first foundational energy contract to run to its final day. The power purchase agreement between TANESCO and Songas, the company created to process Songo Songo gas and generate power at Ubungo, ended on 31 October 2024 without renewal, and the plant was shut down.
That contract had reportedly anticipated the problem, allowing Songas to seek other buyers if renewal talks had not begun by January 2021. The state was entitled to decide that a 20-year arrangement had served its purpose. Investors noticed the timing as much as the decision.
A careful investor will not conclude from this that Tanzania fails to honour its contracts. The licence ran its full term.
The conclusion is narrower and more useful: renewal here is a negotiation rather than an entitlement, and the negotiation tends to happen late. That is a known risk, and known risks can be priced and structured.
An extension process that must begin several years before expiry, with consequences if it does not. An agreed method for valuing assets that revert to the state. A defined operator for any transition period. They are far easier to agree in the first year than in the last week.
The $42 billion LNG agreements now being finalised will run for decades, as will new mining licences for graphite and nickel. Most public conversation about them concerns how they begin. I have not yet heard anyone ask, in public, how they are meant to end.
Amne Suedi is the Managing Director of Shikana Investment and Advisory, Honorary Consul of Switzerland in Zanzibar, and Chair of the Switzerland-Tanzania Chamber of Commerce. Views expressed are strictly Amne Suedi’s only.