Diversification of petroleum products business in Tanzania

Netho Ndilito; Benedict K. Mahona; Dedan Semango

doi:10.51867/scimundi.5.2.16

Auteurs

Netho Ndilito Ministry of Lands, Housing and Human Settlements Development, Dodoma, Tanzania https://orcid.org/0009-0005-2301-5496
Benedict K. Mahona Ministry of Lands, Housing and Human Settlements Development, Dodoma, Tanzania https://orcid.org/0000-0003-0445-1418
Dedan Semango The University of Dodoma, Dodoma, Tanzania

DOI :

https://doi.org/10.51867/scimundi.5.2.16

Mots-clés :

Energy Investment, Pension Funds, Petroleum Value Chain, Port Infrastructure, Risk Management, Tanzania

Résumé

This study examines the capacity of pension funds in Tanzania to invest in the petroleum value chain, highlighting both tangible and financial dimensions. The research highlights energy as a crucial catalyst for socioeconomic growth, emphasising the growing demand and escalating prices of petroleum products both worldwide and locally. Notwithstanding Tanzania's considerable dependence on petroleum imports, institutional investment in this area is still constrained. The study seeks to examine both opportunities and challenges in Tanzania's petroleum sector, informed by the Resource-Based View (RBV) theory, which asserts that enterprises utilise distinctive internal resources to maintain a competitive advantage. A qualitative case study methodology was used, involving expert interviews and desk reviews to provide thorough insights. The data analysis indicated significant investment opportunity across energy and logistic sector, including storage facilities, pipelines, supply, transit, and oil hub projects, propelled by increasing demand, port growth, and infrastructure development. Results demonstrate that 86.67% of participants endorse pension funds' engagement, attributing their support to substantial market demand, governmental energy policies, and effective international practices. Investment opportunities, including offloading facilities, pipeline systems, storage depots, and transportation hubs, are considered viable; nevertheless, obstacles such as elevated construction expenses, port inefficiencies, regulatory mandates, and market uncertainties remain. The analysis determines that investment in Tanzania's petroleum sector is economically feasible and consistent with national development objectives, providing prospects for diversification and revenue generation. Pension funds are advised to strategically engage in infrastructure projects, especially storage, transit, and oil hub development, utilising existing legal frameworks and collaborating with essential government agencies. The paper also recommends further investigation into new finance techniques, such as dollarisation and conveyor belt systems, to improve operational efficiency and mitigate risk. The findings substantiate the assertion that focused investments in the petroleum value chain can enhance economic growth, bolster energy security, and promote local content engagement, contingent upon the prioritisation of strategic planning and stakeholder collaboration. The report offers important details about investment opportunities in Tanzania's energy sector, highlighting the critical roles of infrastructure development, regulatory assistance, and risk management in achieving sustainable advantages.

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