EU gives Tanzania $153 million for road, water projects

 The European Union has given Tanzania 126.5 million euros ($153.28 million) to improve road

infrastructure and access to drinking water in the gas-rich east African nation, the European Commission said on Monday.

Agreements for the aid were signed during a visit to Tanzania by European Commission President Jose Manuel Barroso and other senior EU officials over the weekend, the European Commission said in a statement.

"This new support will help to rehabilitate more than 200 km (124 miles) of roads or provide access to drinking water for 500,000 people and (lead) to improved sanitation infrastructure and services for some 140,000 inhabitants," the statement on the EU delegation's website in Tanzania said.

In its 2012/13 (July-June) budget of 15.12 trillion shillings, Tanzania says it is expecting to receive 3.16 trillion shillings through grants and concessional loans.

Tanzania recently made huge natural offshore gas discoveries, boosting its chances of becoming a regional energy hub.

Many of the investors moving into the region are European firms, including Royal Dutch Shell, French oil group Total and Britain's BG Group. ($1 = 0.8253 euros)

(Reporting by Fumbuka Ng'wanakilala; Editing by George Obulutsa and Andrew Osborn)