For the first time in the country’s history, the Tanzania Investment Centre (TIC) has officially received an application for the registration of a mega fertilizer plant project worth 1.9bn US Dollars.
Ferrostaal Industries Project GmbH, the Germany investor in the project, submitted its application documents to TIC yesterday for the construction of the mega fertilizer plant in Kilwa, Lindi Region.
It will be implemented jointly with Danish shareholders — Holdor Topsoe A/S — will be registered under the name of Tanzania Mbolea and Petrochemicals Company Limited (TAMCO).
Tanzania Petroleum Development Corporation (TPDC) is also a shareholder in the project. According to the TIC Executive Director, Mr Geoffrey Mwambe, the project will create 4,800 direct job opportunities of which 300 will be filled by expatriates.
The plant is expected to run on natural gas with a consumption rate projected at 104 million standard cubic feet per day (104mmscfd). Mr Mwambe said the plant is expected to produce 1.3 million tonnes of UREA fertilizer per annum (about 3,850 tonnes per day), reducing tremendously the country’s use of its foreign currency in importing the fertilizer.
According to the TIC executive director, Tanzania’s annual fertilizer demand stands at 350,000 tonnes. Given the bulk nature of fertilizer production, the executive director said part of the consignment would be exported to neighbouring countries.
Kilwa has been chosen as the project base as it will be easier to haul raw materials from sites in the southern regions. Kilwa’s proximity to the natural gas infrastructure will also simplify project implementation.
“This project is of great importance to the government, given the fact that the country is now implementing an industrialization drive to enable its economy attain middle-income status,” Mr Mwambe said.
He added: “It is very rare for any country, especially one in the developing country category, to register this size of project. It is a strategic and exemplary project that everyone must be proud of.”
According to the TIC executive director, discussions on registration and implementation were held for a long time before an agreement was reached. Mr Mwambe said TIC would expedite the registration process so that investors and the country could realize its potential soon.
He said residence and work permits would also be processed and issued to the expatriates involved, for speedy takeoff. The production of UREA fertilizer by the new plant would bring a sigh of relief to farmers who have been complaining of receiving the commodity late every farming season due to importation drawbacks.
Local sourcing of the fertilizer would automatically reduce its market price, considering that freight charges have always contributed to high prices, negatively impacting on productivity due to farmers’ inability to purchase it.
The envisaged plant is the largest investment in the sector of agricultural inputs. Minjingu Mines and Fertilizers Limited also produce fertilizers for local use and for export. Its production capacity is reportedly 100,000 tonnes per annum.
The submission of the documents to TIC was witnessed by diplomats from Germany and Denmark.