A Review of the Nigerian Energy Industry

Swala gets extension to two licenses in Tanzania

01 September 2015, News Wires – Swala Energy Limited has reported an extension in the period within which an exploration well must be drilled in its Kilosa-Kilombero and Pangani licenses in Tanzania.

Tanzania gas reserve portfolio.
Tanzania gas reserve portfolio.

Tanzanian Ministry of Energy and Mining, MEM, approved the extension to February 20, 2017, the company said.

The one-year extension is to be deducted from the 4-year additional exploration extension period due to commence February 20, 2016.

This, according to the company, has resulted in the additional exploration period having a duration of three years.

Under the Production Sharing Agreements, PSAs, that govern activity on each of the two licenses, the Joint Venture, JV, was originally obliged to drill an exploration well in each license by February 20, 2016.

The JV carried out a seismic survey that was completed in December 2014 and in the same month the JV and the Tanzanian Petroleum Development Corporation, TPDC, agreed to carry out the processing and interpretation of the seismic data during the first half of 2015.

“This left relatively little time in which to confirm drilling locations and secure long lead-time items, and the JV therefore requested TPDC and MEM to allow it to complete its exploration drilling obligations in the next exploration phase. Both entities have now consented to this modification,” the company said in a press release.

Dr. David Mestres Ridge, Swala CEO, said: “The joint venture has been actively preparing to drill the two licenses and we are grateful to MEM and TPDC for their pragmatic flexibility in respect of the drilling timetable. In June, Swala Oil and Gas (Tanzania) Plc appointed an Operations Manager with responsibility for the drilling campaign and it is in the process of engaging a consultant to carry out the Environmental Impact Assessments for the drill locations.

“In parallel, it has been further interpreting the seismic data so as to optimize those eventual drilling locations. The extension of the time limit for completing the exploration drilling allows the JV to continue its preparatory work with the comfort that all steps are being taken to maximise the chances of success and minimise costs whilst not compromising on either health, safety or environmental integrity.”

– – Press Release

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