Norway's Statoil and BG Group of the UK will construct a $15 billion liquefied natural gas (LNG) plant in Tanzania.
Tim Dodson, Statoil’s head of exploration, made the announcement in the wake of the company’s third big gas discovery in Tanzanian waters recently.
Statoil discovered about six tonnes cubic feet (TCF) of gas in the Tangawizi-1 well in Block 2, about 100km off the Tanzanian coast, bringing the company’s total recoverable reserves in the area to about 10-13tcf.
“We need 8 to 10tcf to underpin an LNG project, and to date we have found 10 to 13tcf,” Mr Dodson said, adding that Statoil and BG are currently scouting for a suitable site to set up the plant.
Tanzania’s Deputy Minister for Mineral and Energy, George Simbachawene, told parliament last week that the government is finalising a new gas policy to spearhead the industry.
The energy firms are also considering building two trains, as the LNG processing units are known, with an option for more.
Experts say that there is enough gas in the region for as many as 20 trains, each of which costs about $7 billion.
That would give Mozambique and Tanzania a combined production capacity of 100 metric tonnes of LNG per annum — more than the 77 metric tonnes per annum produced by the world’s biggest LNG exporter, Qatar.
Tanzania sees natural-gas reserves more than doubling by early 2015.
Datafeed and UK data supplied by NETbuilder and Interactive Data.
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