Statoil strikes gas in Tanzania

*Teams up with BG Group on LNG project

18 March 2013, Maputo – Norway’s Statoil said on Monday it has discovered between 4 trillion and 6 trillion cubic feet of natural gas in place at its Tangawizi-1 wildcat well in Block 2 off Tanzania.

The company also said on Monday it is working out plans with UK’s BG Group to jointly develop a $10 billion liquefied natural gas, LNG, terminal yn the East African country.

The gas find in Block 2 is the third high-impact discovery in a year for Statoil in Block 2, where it is partnered by US supermajor ExxonMobil, and brings the block’s total in-place gas volumes up to between 15 and 17 Tcf.

Statoil executive vice president for exploration, Tim Dodson, said the find was the result of an ambitious drilling campaign.

“We have so far completed five wells within 15 months and will continue with further wells later this year. Recoverable gas volumes in the range of 10 to 13 Tcf brings further robustness to a future decision on a potential (liquefied natural gas project) project,” Dodson said.

Tangawizi-1 was drilled by the Ocean Rig Poseidon in a water depth of 2300 metres and the discovery was made in tertiary-aged sandstones.

Dodson, who announced the partnership with BG Group on the LNG project, said the onshore project would be utilising the two companies’ respective gas discoveries off the East African country.

He said his company had enough gas to move forward, adding: “We are working with BG to come up with a recommendation for a landing site. We should be making that recommendation to Tanzanian authorities fairly early in the second quarter”.

UK-based BG Group has discovered between 13.5 and 21 Tcf of gas in place in blocks 1, 3 and 4 off Tanzania, but partner Ophir Energy believes there is resource upside of about 75 Tcf.

Statoil and BG are planning to build a plant with at least two trains to process gas from Statoil’s Block 2 and BG’s Block 1.

“In addition to the 10 to 13 Tcf that we have, they (BG) have a similar kind of number (in Block 1),” said Dodson.

“So if we have 20 Tcf, there will be a discussion on whether you develop all of that straight away or whether you build two trains and then add a potential third train, or even a fourth.”

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