Norwegian oil and gas firm Statoil and the UKs BG Group have outlined plans to build a US$10bn East African Liquefied Natural Gas (LNG) terminal for exports to markets in Asia
The announcement has been made in the wake of an appraisal from the US Geological Survey, which indicated that East African countries like Kenya, Tanzania and Mozambique, could have a huge quantity of undiscovered natural gas.
The estimate has also shown that more gas could be present off the shores of these countries than off Nigeria, which is currently Africa’s biggest energy producer.
A statement from Statoil said that the appraisal of the US Geological Survey has given further evidence of the energy potential of the East Africa region, which has now become a target for exploration due to its relative proximity to Asia’s big LNG consumers.
Statoil said last week that to allow for exports of fuel to major markets, there will be a need for installations to turn gas into frozen liquid for easy transportation by ship.
Statoil head of exploration Tim Dodson said that BG Group and Statoil would build the LNG terminal to make exports to Asia a more viable option.
Dodson added, “We are working with BG to come up with a recommendation for a landing site. We should be making that recommendation to the Tanzanian authorities fairly early in the second quarter.”
BG has interests in three blocks off Tanzania together with Ophir Energy.
The Norwegian firm said that it has made a fresh gas find offshore Tanzania which has brought it closer to having resources to justify a LNG project that would export the fuel from East African region.
Statoil has so far drilled five wells off Tanzania and expects further wells this year, most likely towards the end of the year after geologists analyse data provided from fresh three-dimensional seismic surveys this summer.
