Tanzania made its way onto the world energy map beginning in 2011 with a series of consecutive finds; now it’s making history again with another major gas discovery that the finders are now valuing at some $8 billion.
The UAE’s Dubai-based Dodsal Group says it has discovered 2.7 trillion cubic feet of gas in Tanzania’s Ruvu Basin Coast Region, upping its earlier estimate of 2.17 trillion cubic feet. But the potential upside here is 3.8 trillion cubic feet, or $11 billion in gas. Related: Oil Prices Beyond WTI And Brent
These figures would make this the largest onshore gas discovery in Tanzania, and it’s moving full speed ahead, with a commitment by Dodsal to invest another $300 million in exploration over this year and next, adding to the $200 million it’s already invested.
The Ruvu Basin discovery was initially unveiled in February, but all eyes were on work done over the month to nail down an estimate as to how big this really is.
Tanzania has entered the world energy giants hard and fast. In October 2014, a find of 1.03 trillion cubic feet in the Kamba and Fulusi prospects put it firmly on the gas map and on major investor radar. Related: Who To Back When Oil Rebounds
Without the Dodsal estimates on the new find, Tanzania has about 50.5 trillion cubic feet of gas reserves, but getting it all out of the ground is the next challenge. And the most recent discovery is even more significant in terms of future development because it’s near Dar es Salaam, the main local market, the country’s commercial capital—which also means it’s the path to exports, the gateway to selling gas further afield
And even beyond the estimated $8-billion find by Dodsal, a third well here has reportedly encountered a large gas column that could contain up to 5.9 trillion cubic feet of additional gas, but assessments on this one are still ongoing, and expectations are that the full extent of this find will be revealed in May.
“The sheer size and the scale will give us a huge capital in the years to come to go in to strengthen our current activities, go into exploration and production worldwide,” Dodsal owner Rajen Kilachand told reporters. Related: Canadian Oil Sees Silver Lining To Decline In U.S. Shale
Things have been kept quiet in Tanzania until recently, as investors and potential investors waited with bated breath for the country to come up with legislation regulating the industry. In July, three new bills on oil and natural gas were passed by the parliament and then signed into law by the president in August. These include the Petroleum Act 2015, the Oil and Gas Revenues Management Act 2015 and the Tanzania Extractive Industries Act 2015.
However, elections held on 20 March kept a lid on much of the gas talk while the country awaited a new government.
By James Burgess of Oilprice.com
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