Saturday, June 21, 2014

Dar to get bigger plant than expected

By The Citizen Reporter

Dar es Salaam. Tanzania stands a good chance to get a bigger liquefied natural gas (LNG) plant than initially planned following the discovery of additional natural gas off the country’s coast.

A Norwegian firm, Statoil, which is exploring for oil and gas said on Wednesday that it had found more gas off Tanzania.

Tanzania’s relative cost advantages, an abundance of gas and proximity to Asia’s main LNG buyers make it attractive as a site for an LNG plant, according to a Reuters report.

The company said it discovered an additional two-trillion to three-trillion cubic feet (tcf) in Block 2 offshore Tanzania, boosting the total discovery to about 20 tcf (566 billion cubic metres).

At 1318 GMT, Statoil shares traded at 189.7 crowns, 1.07 per cent up from Tuesday’s close. Statoil said Tanzania’s authorities had asked Statoil and other companies exploring for gas, including BG Group, to present their proposals for the LNG plant. “We have presented our proposal several months ago, but we are still at a very early stage,” said Knut Rostad, a spokesperson for the company.

“There is enough gas to build one LNG train, but the new discovery increases possibilities for a second (LNG) train,” he added, referring to a processing unit.

The latest discovery follows a similar-sized find last December. Statoil said it planned to drill several additional exploration and appraisal wells in Tanzania in 2014 and 2015. Statoil owns a 65 per cent stake in the Tanzania licence while ExxonMobil holds the remaining 35 per cent. “We have initiated a new and ambitious drilling campaign offshore Tanzania following four successful discoveries during the first drilling phase,” reports Nick Maden, senior vice president for Statoil’s in the Western hemisphere on the firm’s website.