Print Back to story
Statoil Largest Tanzania Discovery May Hold Oil, Opens New Play
By Eduard Gismatullin and Brian Swint - Feb 24, 2012
Statoil ASA (STL) and
Exxon Mobil Corp. (XOM)s largest gas discovery off Tanzania may hold crude oil or natural-gas liquids, opening a new play in
East Africa, Norways biggest oil producer said.
The partners have drilled the Zafarani exploration well in Block 2, discovering at least 5 trillion cubic feet of dry gas, Statoil said today in a statement. The discovery could be worth $1.2 billion, said Theepan Jothilingam, an analyst at Nomura Holdings Inc.
We think its a different play, a different age reservoir compared to whats been proven in Tanzania and Mozambique so far, Statoil Executive Vice President for Exploration Tim Dodson said in a phone interview. Its probably an older reservoir than the other discoveries. Statoil plans to deepen the well by several hundred meters to test if there could be some liquid potential as well, Dodson said.
Statoil, based in Stavanger, Norway, plans to focus on exploration off Tanzania and Mozambique, where
BG Group Plc (BG/),
Eni SpA (ENI) and
Anadarko Petroleum Corp. (APC) found more than 70 trillion cubic feet of gas. The Norwegian company is joining the race for gas in East Africa so it can be turned into liquid and shipped to
China and
India, the worlds fastest-growing major economies.
The Zafarani discovery should be seen as a play-opening well for Statoil in East Africa, Jothilingam wrote in an e- mailed report. He based his discovery valuation on Royal Dutch Shell Plcs $1.6 billion bid this week for Mozambique-focused
Cove Energy Plc. (COV) There is a risk of larger resource numbers at Zafarani, he said.
Next Target
Statoil operates the license on Block 2 on behalf of
Tanzania Petroleum Development Corp. (PETD) and has a 65 percent interest. Exxon holds the remaining 35 percent. TPDC has the right to a 10 percent working interest if the project moves to development.
After completing Zafarani, Statoil plans to move the rig to drill the Lavani prospect in Block 2, the company said. It also plans to drill its
first well in the Rovuma basin off Mozambique in early 2013.
Lavani has quite an interesting potential as well, maybe not quite as much as the Zafarani structure, but quite significant volumes there as well, Dodson said. East Africa is a hotspot for exploration.
Statoil plans to invest $3 billion in exploration worldwide this year, he said.
The companys
shares rose 2 percent, the biggest intraday gain since Feb. 9, to 158.1 kroner by 1:20 p.m. in Oslo.
To contact the reporter on this story: Brian Swint in London at
bswint@bloomberg.net Eduard Gismatullin in London at
egismatullin@bloomberg.net
To contact the editor responsible for this story: Will Kennedy at
wkennedy3@bloomberg.net
Statoil Largest Tanzania Discovery May Hold Oil, Opens New Play - Bloomberg
Print | Close this window
Statoil: Tanzania find has up to 5 trillion cubic feet of gas
Fri Feb 24, 2012 7:05am GMT
OSLO Feb 24 (Reuters) - Norwegian oil firm Statoil said its recent gas discovery off the coast of Tanzania has so far proven to hold up to 5 trillion cubic feet of gas, the firm said on Friday.
"The well has encountered 120 metres of excellent quality reservoir with high porosity and high permeability. The gas-water contact has not been established and drilling operations are on-going," Statoil said in a statement.
The company first announced the discovery on Feb. 17 but said it was too early to discuss the size of the find. (Reporting by Balazs Koranyi)
© Thomson Reuters 2012. All rights reserved. Users may download and print extracts of content from this website for their own personal and non-commercial use only. Republication or redistribution of Thomson Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters and its logo are registered trademarks or trademarks of the Thomson Reuters group of companies around the world.
Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests
Statoil: Tanzania find has up to 5 trillion cubic feet of gas | Reuters.com