INTRODUCTION TO OIL AND GAS

LAWS AND REGULATIONS

Oil and gas laws and regulations

OGU 07212
DMI, Tanzania
2021-04-21

By: Dr. Maagi, M.T

Contacts: +255 782 958200
mtakimaagi@gmail.com
 Course objectives

1. Describe legal regimes for the energy and natural resources sector
2. Describe legal issues related to utilization of national oil and gas
resources
3. Apply national laws and regulations to develop energy, oil and gas
resources sector
4. Describe international laws and regulations for the global utilization of
energy and natural resources.
5. Describe legal issues related in utilization of global oil and gas
resources
6. Apply international laws and regulations to establish an economic
environments for utilization of oil and gas resources

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 Learning context

The module will be delivered by the use of

lectures, tutorials, and demonstrations.

Modes of Assessment:
o Continuous assessment: 60%
o End of Semester Examination: 40%

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 Reference Materials

i. William, H. (2016). Fundamentals of Oil and Gas Law. Pennwell

Books. USA.
ii. Gao, Z. (2010). Environmental Regulation of Oil and Gas
(International Energy and Resources Law and Policy Series
Set). 3rd Edition. Gulf Professional Publishing. USA.
iii. Patrick, M. (2016). The Law of Oil and Gas, 10th Edition. Cases
and Materials (University Casebook Series).10th Edition. Gulf
Professional Publishing. USA.
iv. Barker, G. B. (2017). The Engineer's Guide to Plant Layout and
Piping Design for the Oil and Gas Industries. 1st Edition. John
Wiley and Sons. USA.
v. Fanchi, J. (2010). Integrated reservoir asset management:
principles and best practices. 1st Edition. Gulf Professional
Publishing. USA.
 Lecture 1:Tips to be Covered
• What is Oil and Gas laws?
• What is Petroleum?
• The need of Petroleum laws in Tanzania
• Regulation of Oil and Gas Operations in Tanzania
• Background to Tanzania oil and gas laws
 What is Oil and Gas laws?

 Oil and gas law is the area of law that governs oil
and gas production.
 Oil and gas laws determine who owns the right to
drill for oil and gas.
 It determines what conditions drillers or miners
have to follow when they harvest oil and gas.
 Petroleum

Is a complex mixture of

hydrocarbons that occur in Earth
in liquid, gaseous, or solid form.
 The term is often restricted to
the liquid form, commonly called
crude oil, but, as a technical
term, petroleum also includes
natural gas and the viscous or
solid form known as bitumen,
which is found in tar sands.
 Petroleum…

 Petroleum is defined in the law as "means any

naturally occurring hydrocarbon, whether in gaseous,
liquid, solid state or any naturally occurring mixture of
hydrocarbons, whether in a gaseous, liquids, or solid
state or mixture of one or more hydrocarbons
whether in a gaseous, liquid or solid state and any
other substance and includes petroleum that has
been returned to a natural reservoir, but shall not
include coal or any substance that may be extracted
from coal or other rock” (Petroleum act 2015).
The need of Petroleum laws in
Tanzania

 Undoubtedly, the future economy of Tanzania

depends on extractive industry as means of economic
expansion being both a usable resource as well as a
commodity for international trade and finance.

 Together, oil and natural gas may bring Tanzania

unprecedented mobility, help generate electricity, run
the industries, used to produce everything from
agriculture fertilizers to synthetic clothing to product
packaging and countless other items.
The need of Petroleum laws in
Tanzania..

 Moreover, following the recent years discovery of oil

and gas in Mtwara arose a need to put in place
comprehensive laws to properly govern the oil and
gas resources in the country.

 Currently, Tanzania has put in place a

comprehensive legal and regulatory framework
regulating the petroleum exploration industry.
 The need of Petroleum laws in
Tanzania..

 The government of United Republic of Tanzania

has various substantive and subsidiary laws, which
affect performances and activities of petroleum
development, starting with the Constitution of the
United Republic of Tanzania.

 Article 4(3) of the Constitution indicates that

matters of natural resources such as oil and gas are
under the management of the United Republic of
Tanzania.
 Regulation of Oil and Gas
Operations in Tanzania

Petroleum resources are the property of the State,

whether or not located on state lands.
No person is allowed to explore for or produce
petroleum without receiving a petroleum right under the
Law. Law and regulation in oil and gas industry has
several objectives:

 Regulate sector operations and determine the sharing of

the petroleum revenues and income between the State
and the entity authorized to undertake these operations.
 Regulation of Oil and Gas
Operations in Tanzania..

 Maximize and preserve monetary benefits in the long

term and foster exploration
 Protecting oil and gas natural resources for the
benefit of present and future generation
 Protecting the environment (including air and water
quality)
 Protecting workers’ and the public’s health and safety,
and reducing wasted resources.

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 Petroleum exploration and
production in Tanzania

 The exploration of oil and gas in Tanzania started way

back in 1952.
 Nothing was discovered until 22 years later when the
first natural gas discovery was made in 1974 at Songo
Songo island, located at Lindi region.
 This was followed by another discovery at Mnazi Bay
in 1983 and by 2012 about 8 trillion cubic feet of
natural gas had been discovered at Songo Songo,
Mnazi Bay, Mkuranga, Kiliwani North and Ntorya.

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 Petroleum exploration and
production in Tanzania..

 Regulation of oil and gas operations in Tanzania

has existed in various forms for many years.
 At present, the Petroleum Act of 2015 principally
governs petroleum exploration and development.
 The Law governs the exploration and production of
petroleum onshore and offshore Tanzania,
including its continental shelf.
 Note that when the term “petroleum” is used, it can
refer to both oil and gas.
 Petroleum exploration and
production in Tanzania..
 The act permits the government to enter into
Production Sharing Agreements (PSAs) under which
an oil and gas company is given a contract to explore
for, and produce, petroleum.
 Resources are owned by the state whereby licenses
are granted to the National Oil Company; Tanzania
Petroleum Development Corporation (TPDC).
 The government (the State), on behalf of the people
of Tanzania, and TPDC contracts a private oil and
gas company to explore and develop the resource.
 Petroleum exploration and
production in Tanzania..
 This arrangement is fundamentally different from that
in the conventional mining sector whereby a private
company (an investor) is given the right to prospect
and develop the mine as per the Mining Act of 2010.
 Background to Tanzania oil and
gas laws

The energy sector in Tanzania has historically had

two key items of legislation, namely:

1. The Petroleum Exploration and Production Act

1980 (PEPA).

2. The Petroleum Act 2008 (PA 2008)

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 Background to Tanzania oil and
gas laws..

 PEPA dealt with upstream petroleum matters,

specifically as they relate to 'petroleum' including oil
and gas.
 PA 2008 dealt with downstream petroleum matters.
 The Government of Tanzania (GoT) has long intended
to update both items of legislation. There was also
recognition of a lack of legislation regulating anticipated
midstream activities. Thus, in 2015, the new (current)
petroleum act was put in place.
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