swala at the centre of tanzanian feud

Ok
Well I now think I have worked out why the share price has been drifting lower in the last month. Mystery solved.

It seems Swala's Tanzanian champion and 3.3% owner Reginald Mengi is going head to head with the energy Minister.

This is the article in the African Intelligence Newsletter:
Sospeter Muhongo in turmoil
9/5/2014

Mining and energy minister Sospeter Muhongo is being targeted by local businessmen who want a share of the oil and gas sector.


Relations between mining and energy minister Sospeter Muhongo and some members of the Tanzanian business community interested in entering the sector have deteriorated since October 2013 when a second round of exploration licences was issued for the sector. The businessmen, led by the powerful tycoon Reginald Mengi, intends to use the National Assembly's annual budget session from 6 May to 27 June to win over some MPs to its cause. Its aim is to put pressure on Muhongo and his ministry's permanent secretary Eliakim Maswi, for them to go back on their present positions: they currently consider Tanzanian investors as lacking the expertise and the capital funds to act in this sector and so they leave the field entirely to foreign companies.

Muhongo considers that the local businessmen particularly play a role of intermediary for certain foreign firms and that there is therefore no reason for the State to favour them. The lobby led by Reginald Mengi, who is both the chairman of the Tanzania Private Sector Foundation (TPSF) and a shareholder in the oil company Swala Energy Tanzania, could therefore push the parliamentarians into calling for Muhongo's and Maswi's resignations.

Muhongo must take this affair seriously for several reasons. For one thing, Mengi is highly influential – at least two ministers who quarrelled with him in the past, namely Lawrence Masha and Wilson Masilingi, subsequently lost their jobs. Secondly, certain Western financial institutions are beginning to ask questions about a series of decisions the Tanzanian minister had made, such as: taking on loans from the Exim Bank of China, a plan for a gas pipeline between Mtwara and Dar es Salaam and lack of transparency of mining licences and contracts.