UPDATE 1-Statoil find adds to East Africa gas hopes

Fri Feb 17, 2012 8:58am GMT
 

* Staoil, Exxon find "good quality reservoir" in Tanzania

* Region quickly becoming major gas hub

OSLO Feb 17 (Reuters) - Norwegian oil and gas firm Statoil has found natural gas offshore Tanzania, marking the latest discovery which is rapidly making east Africa a key gas hub on the doorstep of Asia's fast growing markets.

Statoil said in a statement on Friday it and its partner Exxon Mobil found gas in a "good quality reservoir" in the Zafarani-1 well, a deepwater frontier area where no wells had been drilled before 2010, but added further evaluation was needed to assess the size of the find.

"East Africa will soon become a major gas hub if you look at all the big discoveries made in Mozambique, and the demand side also looks great considering how close India with its rapidly growing demand is," Magnus Smistad, an analysts at Fondsfinans said.

"It's a region where Statoil needs to be and its blocks in Mozambique are also very exciting," Smistad added.

Mozambique, the fastest growing energy player in the region, this month estimated that energy firms will spend $50 billion over the next decade to develop its liquefied natural gas (LNG) industry.

Just this week, Italy's Eni said it had made a new giant offshore gas discovery in Mozambique with a potential capacity of 212.5 billion cubic metres (bcm) while Anadarko Petroleum last month made a discovery in a Mozambique well it called its best so far in the region.

Tanzania has lagged its neighbour to the south but BG Group this month said appraisal work showed its new discoveries offshore Tanzania contained 3 trillion cubic feet of resources.

Hoping to cash in on the interest, Kenya has also marked out eight new offshore exploration blocks which it expects to list by end-February and its government said France's Total is negotiating for the rights to one of the blocks.

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