Oil and Natural Gas in Tanzania

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• Natural gas proved reserves: 22.65 billion cu m (1 January 2005 est.)

History

Tanzania has been intermittently explored over the last 50 years with most multinational petroleum companies being present, at one time or another. So far only 35 exploration and development wells have been drilled in 280,000 square kilometres of hydrocarbon potential sedimentary basins. Since 1980, foreign oil prospectors have invested more than $293 million searching for oil in Tanzania without success. The government in Dar es Salaam continues to encourage oil exploration in the country, through the Tanzania Petroleum Development Corporation (TPDC), seeing oil as a key to economic development. Experts have long suspected that there are considerable hydrocarbon reserves off Tanzania's coast.

• A second licensing round, since 2000, covering deepwater acreage to the north of Dar es Salaam was concluded in August 2002, calling for bids on 12 blocks. Bids were received from only two companies, Shell and Global Resources, both interested in blocks 9-12. In October 2002, exploration rights were granted to Shell for all four blocks. Shell conducted 2D seismic surveys of the areas, and will use the results to conduct 3D seismic surveys. Royal Dutch/Shell hoped to begin exploration in 2004 on its four deep-water blocks.

• Artumas Group Inc operates the Mnazi Bay Concession. The Mnazi Bay exploration and production concession covers a 756 sq. km area in south eastern Tanzania, bordering Mozambique to the south and lying along the north eastern flank of the Rovuma River. In 1981, AGIP (now ENI) drilled a shallow water, off-shore well and discovered the Mnazi Bay Gas Field. However, due to a lack of a commercial gas market at the time, AGIP capped the well, leaving the wellbore integrity intact, and relinquished the concession. In 2004, Artumas acquired the rights to the Mnazi Bay concession. With no signature bonus requirement, the Company committed to provide a gas-to-power energy solution for the Mtwara/Lindi region to replace their existing unreliable, aging system. This has become known as the Mtwara Energy Project. New seismic data and interpretation indicates the Mnazi Bay Gas Field to be more than double the size of original estimates, covering some 75 square kilometers in aerial extent versus the original estimate of 34 square kilometres.

Source: Artumas Group Inc

• Tullow Oil plc has agreed a farm-in deal with Ndovu Resources Limited, a subsidiary of Aminex plc, which involves the company earning a 50% interest in two licences in the Tanzanian portion of the Ruvuma Basin. Tullow will be appointed Operator upon completion of the farm-in commitment and will provide technical support during the seismic acquisition programme. The farm-in deal and subsequent change of operatorship are subject to formal approval from the Tanzanian government. The acreage involved lies approximately 500 km south of Dar es Salaam, along the Mozambique border and comprises the Mtwara and Lindi licences which cover a total area of 12,361 sq km. The licences are adjacent to the Mnazi Bay gas field, discovered in the 1980's and currently under development. The area was last explored in the 1980's and prior to recent activity less than 1,400 km of 2D seismic had been recorded. Numerous leads have been identified by previous operators from this data, many with significant potential. Initial targets will be Tertiary and Cretaceous reservoirs. Oil seeps are known in the area.
  

Source: Tullow Oil

• Aminex plc is exploring the Nyuni and Ruvuma licence areas. The Nyuni-1 well was drilled to nearly 4,000 metres during 2003/4 and encountered numerous oil and gas shows in a thick but complex reservoir sequence. The well did not flow commercial quantities of oil and gas under limited test but established the presence of live crude oil from a wide-ranging Jurassic source, opening up the prospectivity of the whole region.
  In the period 2005-7 new marine 2D seismic and transition zone 2D seismic was acquired over the Nyuni licence.
  In 2007 Aminex farmed out interests to Key Petroleum Ltd. (20%) and to RAK Gas Commission (25%). In addition East Africa Exploration Ltd. earned a 10% interest through contributing new seismic valued at $2 million. An earlier provisional farm-out to East Coast Energy Ltd. was never finalised.
  In April 2006 Aminex signed a contract with Caroil of France for the use of the Caroil-6 drilling rig to drill two wells on the Nyuni licence. Mechanical delays with this rig have delayed first spud date until Q4 2007.
  In late 2005, Aminex finalised a PSA for the Ruvuma onshore/offshore area in South Tanzania covering 12,000 sq km. Before end 2005 Aminex had acquired 500km of new seismic in the offshore part of the licence.
  Onshore seismic is being acquired over Ruvuma during 2007 and a first well location selected with planned drilling in 2008.
  

Source: Aminex plc

• Bounty Oil & Gas NL has a 10% share (Aminex-60%, Petrom SA, the state oil company of Romania-30%) of the Nyuni Block of 2860 km2, located just off the coast of Tanzania, 200 kms south of Dar es Salaam. Adjacent to the permit is the Songo Songo gas field, which contains 590 Bcf (proved and probable) of recoverable gas. The proven reserves are contracted to the Ubungo Power Plant. A 12-inch diameter pipeline capable of transporting 105 mmcfgd (uncompressed) from the field to shore has been completed and a 16-inch 120 mmcfgd pipeline up to Dar-Es-Salaam is under construction and due for completion in May 2004.

• In May 2005, the Tanzania Petroleum Development Corporation (TPDC) offered Ophir Energy (U.K.) , Statoil ( Norway ) and Petrobras ( Brazil ) production sharing agreements (PSAs). In October 2005, Ophir Energy signed the PSA for Block One, while Statoil and Petrobras are still negotiating contracts for their PSAs.
  

• In 2004, TPDC signed with Petrobras for deepwater Block Five, off Mafia Island and with Maurel & Prom (France) for acreage along the coast.
  

• Shell has yet to finalize an agreement for Blocks 9 - 12 near Zanzibar and Pemba Islands, which it won over two years ago.
  

• Dodsal Hydrocarbons and Power (Tanzania) Pvt. Ltd. (a wholly owned subsidiary of Dodsal Resources) signed a Production Sharing Agreement with Ministry of Energy and Minerals and Tanzania Petroleum Development Corporation for exploration of oil and gas for the RUVU block which is approximately 15,300 square Kilometers.
  

• Discussions are ongoing between government and Petrobras of Brazil for oil and gas exploration in the deep waters of Block No 8 and Tullow Oil of UK for exploration in Northern Lake Tanganyika.

• Dominion Petroleum Ltd, has 48,939 square kilometres (12.09 milllion acres) under four Production Sharing Agreements in Tanzania. These include four licenses onshore - Mandawa, Kisangire, Lukuliro and Selous - and one license offshore - Block 7. In January, 2008, the company was undertaking a 2D-seismic survey on part of its Tanzania Production Sharing Agreement (‘PSA ‘) areas. In November, 2007, Dominion’s contractor Upstream Petroleum Services Ltd. began acquisition of approximately 230 km of seismic in the northern part of Mandawa.
  The objective of this survey is to better define a large sub-surface feature identified on the 2006 survey, which the company believes may be a large carbonate build-up, and to identify further drilling targets. The survey will be completed by the end of February, 2008.
  Dominion has also commenced preparation of the site for the Mihambia-1 well to be drilled in the second half of 2008. Construction of an access road to the site is almost complete.
  On the 3rd of January 2008, the seismic vessel ‘Geomariner’ completed the acquisition of approximately 4,325 km of 2D seismic on the Company’s offshore License, Block 7. The purpose of this survey is to identify drilling targets for further analysis using 3D seismic.