International Edition


April 26, 2017

Breaking News, World News and Taiwan News.
About Us
Contact Us

Norway's Statoil makes 3-trillion-cubic-foot Tanzania find, nears project goal

OSLO -- Norwegian oil firm Statoil discovered another big gas deposit off Tanzania, putting it within reach of having the gas needed for a project analysts say could cost over US$10 billion to develop.

Statoil and ExxonMobil found 3 trillion cubic feet (Tcf) of gas in the Lavani well 2,400 meters under the sea, and added 1 Tcf of gas to the nearby Zafarani discovery, giving them around 9 Tcf of gas, Statoil, the block's operator said on Thursday.

"We would need another Lavani to feel comfortable we have the gas for commercial development," Tim Dodson, Statoil's exploration chief told Reuters. "But I expected more gas."

"The Tanzanian government's expectation that development would start in seven years is not completely unreasonable," Dodson added.

The discovery confirms East Africa's status as one of the world's fastest growing gas hubs with the U.S. Geological Survey estimating that 253 trillion cubic feet may lie off Kenya, Tanzania and Mozambique, relatively close to Asia's lucrative LNG markets.

Anadarko Petroleum (APC.N) earlier estimated its reserves off northern Mozambique at 50 trillion cubic feet while Eni said its neighboring exploration block may have 52 trillion cubic feet of gas.

"This is a highly significant discovery for Statoil," Trond Omdal, an analyst at Arctic Securities said.

"It would cost at least US$10 billion to develop the field, and gas would not come to the market sooner than after 2020."

Dodson said Statoil would almost certainly opt for some sort of liquefied natural gas solution but declined to provide a development cost estimate.

"Developing this will be quite a challenge given that in East Africa, like in Tanzania and Mozambique, there's limited infrastructure in place," Dodson said. "So it's going to take a little bit longer than if we had the infrastructure in place."

He added that Statoil was now in the process of securing rigs and making plans for further exploration activity.

"We estimate a value of the discovery plus the upgrade on the Zafarani discovery of 1.3 krone per share," Swedbank First Securities said in a note. "We assume a fair share price reaction would be 0.8-1.0 krone per share," it added.

The discovery confirms Statoil's recent track record for solid upstream success after it has made big finds in the mature areas of the North Sea, the Arctic Barents sea, in Brazil and Tanzania.

Statoil operates the license on 5,500-square-kilometer Block 2 on behalf of Tanzania Petroleum Development Corporation and holds a 65 percent stake while ExxonMobil Exploration has 35 percent.

Write a Comment
CAPTCHA Code Image
Type in image code
Change the code
 Receive our promos
 Respond to this email
Subscribe  |   Advertise  |   RSS Feed  |   About Us  |   Career  |   Contact Us
Sitemap  |   Top Stories  |   Taiwan  |   China  |   Business  |   Asia  |   World  |   Sports  |   Life  |   Arts & Leisure  |   Health  |   Editorial  |   Commentary
Travel  |   Movies  |   TV Listings  |   Classifieds  |   Bookstore  |   Getting Around  |   Weather  |   Guide Post  |   Student Post  |   Terms of Use  |   Sitemap
  chinapost search