Natural gas extracted locally has already saved Tanzania some $1.2 billion to date that would otherwise have been spent buying oil for power production.

Using natural gas for electricity generation instead of oil imports will save the East African economy up to $6 billion by 2024, according to an official with gas utility Songas.

Songas -- a consortium including state-run Tanzania Petroleum Development Corporation and Bermuda-based Globeleq -- gets its gas from Songo Songo Island off the Indian Ocean coast near Dar es Salaam, and generates about 190 mega watts (MW).

The gas utility has sold electricity to state-run Tanzania Electric Supply Company (TANESCO) since 2004.

"Because the power purchasing agreement is for 20 years, we predict to bring more savings, maybe $5 billion to $6 billion," says Oswald Mutaitina, Songas' director of business development.

Songas, through operator PanAfrican Energy, a subsidiary of Toronto-listed Orca Exploration, processes 70 million cf per day for use at its power plants and by industrial customers in Dar es Salaam, the country's commercial capital.

Tanzania suffered serious power cuts in 2006 after drought slashed hydro power production, and like many oil-importing countries it has also been hit by high global crude prices.

But its natural gas deposits have bought it some relief.