DAR ES SALAAM, June 9 A Tanzanian unit of Australia's Swala Energy Ltd is selling an almost 10 percent stake worth 4.8 billion shillings ($3.52 million) in an initial public offering on the east African nation's newly launched bourse for small firms.
The initiative supports a government drive to give Tanzanian citizens a share in the country's gas discoveries, which have made Tanzania hot property for energy firms while also raising calls from the population for a stake in the new-found riches.
For now, Tanzania only produces small quantities of gas for domestic use but major players such as BG Group, Statoil and Exxon Mobil plan to build a liquefied natural gas (LNG) plant for exports, although that is years away.
The offer, which runs from June 9 until July 4, is for 9,600,000 shares at 500 shillings each, said a statement from Oil and Gas (Tanzania), which is 50 percent owned by Swala.
The shares will be listed on the Enterprise Growth Market for smaller firms that was launched last year.
A new law could make it a requirement for energy firms working in Tanzania to list local subsidiaries, although the code has not been implemented yet.
The CEO of Swala Oil and Gas Tanzania, David Mestres Ridge, told Reuters that the company would invest funds raised from the IPO in "the seismic programme that is due to start in Pangani in July and in Kilombero in September."
Stock exchange chief Moremi Marwa told a Reuters African investment summit in April that Swala was acting on its own initiative to supplement capital already coming from the parent firm.
"We strongly believe that Tanzanians should be given an opportunity to participate in the oil and gas business; this IPO opening allows them to do just that," Abdullah Mwinyi, a director at Swala Oil and Gas Tanzania, said in a statement.
A prospectus can be found at www.nihisa.com. ($1 = 1362.7500 Tanzanian Shillings) (Writing by Edmund Blair; Editing by Mark Heinrich)