The company is one of the cheapest and competitive all-in generation costs in East Africa. It sells its electricity to TANESCO at approximately US?5.5 per kWh (approximately TZS 110 per kWh at an exchange rate of 2000).
By utilizing the country?s own natural gas resources, the Songo Songo gas to electricity project has substantially reduced operating costs for TANESCO and other industries in Tanzania. Over US$5 billion has been saved since commercial operations commenced in 2004.
Songas is a majority owned by Globeleq, a leading independent power producer in Africa. Other investors in Songas include TPDC, TDFL and TANESCO. The Government of Tanzania, the Ministry of Energy, the Ministry of Finance as well as the World Bank and CDC played a key part in the project?s development.
Songas also processes and transports gas for other TANESCO-owned power plants and approximately 30 industrial consumers who use the natural gas in various manufacturing processes.
The business consists of two different operating streams,
- Invested in and operating natural gas fired generation capacity to provide electricity to TANESCO (who then resell this electricity to their own customers); and
- Invested in and operating the Songo Songo Island upstream and midstream gas infrastructure to enable gas shippers (TPDC/PAT) to sell gas to their customers in Dar es Salaam
Gas from the Songo Songo gas field is processed on the island at Songas' processing facility to remove water and other hydrocarbon condensates. It is then transported through a 225 kilometre pipeline to Dar es Salaam where it is used in Songas? Ubungo Power Plant (?UPP?), the largest gas-fired power station in East Africa.
Songas? power plant is located in Ubungo and uses six aero-derivative gas fired turbines that generate 180MW of electricity or approximately 25% of Tanzania?s current electricity demand. This electricity is supplied to the national electricity grid and distributed to end users by TANESCO.
Songas provides a clean, reliable alternative fuel source in a country that is otherwise heavily dependent on the region?s water supplies for hydroelectric power and the importation of expensive fuel oil.
Safely provide clean , reliable, cost effective electricity, creating sustainable returns and supporting the development of the electricity power sector in Tanzania
Songas generates electricity using gas from the Songo Songo Island gas fields, off the coast of southern Tanzania. The project reached commercial operation in August 2004 and was immediately expanded to reach its current capabilities in August 2005. The project had a total cost of approximately US$320m.
Songas? gas infrastructure currently consists of
- Production wells and flow lines;
- An existing gas processing facility owned by Songas and operated by PAT with a design capacity of 70MMscfd ?operating at high ninetieth
- An existing 105MMscfd 225km pipeline to Dar es Salaam owned and operated by Songas.
The Songo Songo gas to electricity project was completed in 2004 and was designed to provide an average production of 55MMscfd with a peak production of 70MMSfd.
This was based around designing the system to supply enough gas for use at Songas? UPP with a small additional amount of gas for use by other industrial users such as Twiga Cement. Since then, gas consumption in the country has increased substantially as commerce and industry have realised the economical and environmental benefits of using this local resource.
In January 2009 the maximum capacity of the gas processing plant was increased to 90MMscfd on a temporary basis to provide some relief to TANESCO (who at the time was suffering from a generation capacity shortages)
This increase in capacity allowed the industrial sector to consume around 10MMScfd and TANESCO to fuel both Songas' 180MW Ubungo Power Plant and 145MW of their own gas fired generation (originally the Dowans and Aggreko plants but superseded by TANESCO?s Ubungo and Tegeta plants).
Since then, Songas and Pan African have also been working on an additional temporary solution. In June 2011 following a significant engineering investigation the capacity of the gas processing plant was increased further to 105MMScfd (this is 35MMSCfd above design capacity and 15 MMscfd on top of the previous temporary solution). This is not permanent answer and is well beyond the original design parameters of the facility.
It should be noted that Songas? facilities are now at their physical limits and cannot increase throughput any further without a significant investment.