Statoil's Tanzania discovery points to four-train LNG
The discovery added up to 85bn cm to the block's reserves
A sixth consecutive gas discovery by Statoil has lifted Tanzania’s offshore reserves well above the threshold for a four-train liquefied natural gas (LNG) complex. Statoil says reserves in its Block 2 amount to 566 billion cubic metres (cm), while the other operator with gas discoveries, BG, has reserves of 425bn cm in Blocks 1, 3 and 4.
Statoil’s latest discovery was with the Piri-1 well, which added up to 85bn cm to the block’s reserves and lifted the total to 566bn cm of gas-in-place. The company has had a remarkable 100% success record with its wells in Block 2, and drilling will continue this year and next on exploration and appraisal targets. The drillship, Transocean’s Discoverer Americas, has been moved to drill the Binzari-1 exploration well.
Statoil and BG are in discussions over constructing a joint LNG complex, with a location in the southern Lindi region being preferred by the energy minister. With a typical 5 million tonnes a year (t/y) LNG train processing 140bn cm of feed gas over a 20-years lifetime, and requiring up to 160bn cm including fuel gas, each operator already has reserves comfortably in excess of the minimum for two trains.
But Tanzania’s LNG development is some way behind that of Mozambique, its southern neighbour, where leading operators Anadarko and Eni have been targeting the start of exports in 2018 – although that schedule is looking increasingly ambitious. Indications for Tanzania’s start-up are 2020-22. Both countries have considerable infrastructure to provide before construction work can start in earnest, with ports, roads and accommodation to be built.
Tanzania and Mozambique are both eyeing the Asian market, where they will have a transport advantage over the other African sources of LNG. But export volumes will be so large – perhaps 20m t/y from four trains in Tanzania, and the same from the planned initial four trains in Mozambique – that the first-mover could gain a strong position in the market.
Statoil operates Block 2 in a 65:35 venture with ExxonMobil. Interests in Blocks 1, 3 and 4 are BG, 60%, Ophir, 20% and Pavilion, owned by Singapore’s state-owned Temasek, 20%.