BG Group find offshore Tanzania adds fuel for LNG export plant

BG Group find offshore Tanzania adds fuel for LNG export plant

JILLIAN WARD

LONDON (Bloomberg) -- BG Group and its partners discovered natural gas at a well off Tanzania, adding reserves for a planned export plant in the East African country.

The Kamba-1 well in Tanzania’s block 4 found 1.03 Tcf of gas, according to a statement from Ophir Energy, which holds a 20% interest in the block. That’s probably enough to justify a third production unit at a proposed gas-export plant, it said.

BG, the UK’s third-largest oil and gas producer, plans to build a plant in Tanzania to export LNG to Asia. The government is assessing where the plant should be located, while legislation to ensure gas contributes more to the economy is due to be presented to parliament by November.

The Kamba-1 well was drilled by the Deepsea Metro I drillship in a water depth of 1,379 m. Image: BG Group

The Kamba discovery means there’s enough gas in block 4 to justify a third 5 million ton-a-year LNG plant for the project, Ophir CEO Nick Cooper said in the statement.

Ophir shares rose as much as 3.1% to 227.7 pence in London and traded at 225.2 pence at 9:50 a.m. local time.

The well is the joint venture’s sixteenth consecutive discovery in the area and is the final project in its current drilling campaign. It increases London-based Ophir’s estimate of recoverable resources across its three blocks in Tanzania to 17.1 Tcf, the company said.

The “increase in gas resource across Ophir’s Tanzania assets suggests drilling activity continues to support future development plans,” analysts at Deutsche Bank AG, which rates the company at hold, said in a note. “Aside from the modest uplift, higher volumes on Block 4 also increase confidence that enough feedstock exists to supply an LNG train.”