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Tanzania presidency hopeful to fix LNG land issues in weeks, if win confirmed

Tue, 27th Oct 2015 11:08

* Pre-election polls, ruling party see Magufuli victory

* Land issue delays seen holding back LNG plant

* Construction of LNG plant would spur Tanzania's growth

By Edmund Blair

NAIROBI, Oct 27 (Reuters) - A government led by Tanzania'sJohn Magufuli, if his election victory is confirmed, wouldwithin "a few weeks" remove impediments related to the site of aplanned liquefied natural gas (LNG) plant and other issues, aclose aide said on Tuesday.

Pre-election polls forecast a win by Magufuli, whose CCMparty has been in power for half a century. CCM campaigndirector January Makamba said the party's count from itsrepresentatives at polling stations suggested Magufuli would winabout 60 percent of the presidential vote.

The opposition has disputed the ruling party's claims. Finalresults from Sunday's vote are not expected until Thursday.

Magufuli has promised more urgency in decision-making,responding to a frequent complaint from businesses. One examplehas been delays in finalising a site for the multi-billiondollar LNG plant that will exploit huge offshore gas finds.

"We know that it is a competition. If the neighbouringcountry Mozambique gets its own (plant) running, ours will notbe viable," Makamba told Reuters, adding that any officialimpediments would be resolved "after a few weeks" in office.

"It will change the landscape of Tanzania's economy," saidMakamba, noting there had been issues related to ownership andtransfer of land for the plant expected to be sited aroundLindi, south of the commercial capital Dar es Salaam.

Tanzania has allocated funds for the land purchase.

"There are some things that can be sorted out by governmentimmediately," Makamba said by telephone.

BG Group, being acquired by Royal Dutch Shell, with Statoil, Exxon Mobil and OphirEnergy plan to build the LNG export terminal, with theaim of starting up in the early 2020s.

But their final investment decision has in part been held upby delays in finalising issues related to the site.

Mozambique's plans to build an LNG plant have moved moreswiftly. With other LNG projects moving ahead around the world,the best deals for long term gas sales contracts will likely besecured by those who come on stream first, analysts say.

Tanzania could add 2 percentage points to existing annualgrowth of 7 percent simply by starting work on the huge plantthat would draw in billions of dollars of investment, a seniorTanzanian central bank official told Reuters last month.

Makamba said Magufuli would also press on with other majorprojects, such as improving rail links with central Africanneighbours and expanding light manufacturing in Tanzania.

(Editing by Alison Williams)

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