Mozambique's ENH sees Buzi gas potential at 3.3 tcf

CAPE TOWN (Reuters) - Mozambique oil and gas firm Empresa Nacional de Hidrocarbonetos (ENH) said on Wednesday it plans to drill the first well at its Buzi gas block in 2011, with its reserve potential seen at up to 3.3 trillion cubic feet (tcf).

"Based on the geological studies, we have mapped 1 tcf of gas reserves with upside potential of up to 3.3 tcf ... we expect that in 2011 the first well will come," Nelson Ocuane, chairman at the state-owned company, told Reuters on the sidelines of an Africa oil conference.

He also said ENH expects to sign a deal by December with electricity firm Electricidade de Mocambique (EDM) for the supply of 2.5 million gigajoules of gas per year to feed the company's power plants.

"The intention is to have the first gas delivered to EDM by 2011 ... in December we will sign a deal for the supply of 2.5 million gigajoules of gas per year," he said.

ENH will have to build a 15.5 km pipeline from Matola to Maputo where EDM's plants are based, a project estimated to cost $20 million.

The company is also mulling the construction of another 68-km gas pipeline from Ressano Garcia on the border with South Africa to Maputo to further boost supplies to its customers, at a cost of $50 million.

Ocuane said the country's total gas reserves were still estimated at 14 tcf, but ENH is involved in various exploration projects across the country along with other firms which could change that forecast.