Tanzania will seek as much as an 85 percent share of profit from oil and gas produced in the East African nation, according to a draft law being debated in parliament.

The government proposes taking a 60 percent to 80 percent portion of profit from onshore gas production, with the ratio varying depending on quantity, according to the Petroleum Act 2015, distributed Thursday by the Energy Ministry in the commercial capital, Dar es Salaam. The ratio increases to a maximum of 85 percent for gas produced offshore, while the share of oil profit is set at 50 percent to 70 percent, depending on quantity and source of extraction.

Tanzania’s gas reserves total an estimated 55.1 trillion cubic feet, making them the second-largest along the East African coast after Mozambique. BG Group Plc, which is being acquired by Royal Dutch Shell Plc, Statoil ASA of Norway and partner Exxon Mobil Corp. all have blocks in Tanzania.

 The legislation, which is expected to be passed before parliament is dissolved in July, “will bring a level of certainty in the oil and gas landscape,” said Ahmed Salim, a Dubai-based analyst at Teneo Intelligence. The bill will probably be passed by parliament without a “significant amount of scrutiny” because lawmakers are involved in political campaigns ahead of elections in October, he said by e-mail.

The government also plans to seek royalty payments of 7.5 percent from offshore oil and gas producers and 12.5 percent from onshore oil and gas producers, according to the proposed legislation.

Source: Bloomberg