marketing
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Orca markets Additional Gas to power, industrial and commercial markets in Tanzania. The core market is power generation. Orca has also developed a sizeable industrial market that includes 35 customers in the Dar es Salaam area. The company is currently marketing compressed natural gas (CNG) to be used in transportation and by industrial and commercial customers who cannot be economically connected to the company’s low pressure gas distribution system.
Power Generation
As at 31 December 2009 there was approximately 1,127 MWs of available power generation in Tanzania. Power generation capacity has steadily increased over the last few years due to a rebalancing of the power generation mix. Lower than anticipated rain fall has now resulted in hydro generation accounting for less than 50% of the annual available generation. The only major water storage is at the Mtera reservoir which supplies the 80 MW Mtera and 200 MW Kidatu hydro plants. The remaining 261 MWs of hydro generation is “run of river” which is only operational on average for 4-5 months in the year.
Industrial
Natural gas is a reliable, cheaper and more environmentally friendly source of energy than heavy fuel oil or coal. There has been a steady uptake in the volumes of industrial gas sales, averaging approximately 6 MMscfd by 2009.
Orca continues to connect additional industrial customers to its low pressure pipeline system that is currently in excess of 50 kilometres. 35 industrial customers are currently connected, and examples of industries using Additional Gas include; textile mills, breweries, glass and steel manufacturers.
Looking forward there is limited opportunity to connect many material new customers and therefore growth in industrial volumes in the short term will primarily be driven by organic growth from within the existing customer base. |
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Demand for cement in Tanzania has also increased significantly over the past few years with extensive construction of new offices and accommodation in Dar es Salaam. A new kiln (Kiln 4) at the Tanzania Portland Cement Company’s Wazo Hill cement plant at Dar es Salaam was commissioned for use with Additional Gas in Q2 2009. Continued growth in demand for cement is forecast to lead to an increase in the gas consumption at Wazo Hill in the near term.
Compressed Natural Gas (CNG)
During 2008, Orca commenced the construction of CNG facilities in Das es Salaam. These include one “Mother Station” consisting of a compressor, a vehicle refuelling dispenser and two trailer filling facilities as an alternative to diesel and gasoline to fuel vehicles converted to run on CNG. Three “Daughter Stations” will supply some industries, hotels and one institution. The CNG facilities are intended to supply gas to consumers that cannot be cost-effectively connected to Orca’s existing low pressure gas distribution system.