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Ophir Energy Drills 3rd Gas Well in Tanzania After Discoveries

Dec. 6 (Bloomberg) -- Ophir Energy Plc, a U.K-based oil and gas exploration company, started drilling a third well off the coast of Tanzania after discovering gas at two offshore sites since October, the state-run energy company said.

Drilling of Chaza 1 well, located in Block 1, will probably be completed this month or next, Halfani R. Halfani, director of exploration, production and technical services at the Tanzania Petroleum Development Corp., said today by phone from the commercial capital, Dar es Salaam.

The Pweza 1 and Chewa 1 exploratory wells, about 10 kilometers (6.2 miles), apart southeast of Mafia Island, showed there is natural gas in Block 4, Halfani said. He wouldn’t elaborate on the possible size of the finds until further studies are done.

“We haven’t done much analysis yet on the two discoveries, but we believe this is good news,” Halfani said. “It gives the investors the motivation to continue their exploration program.”

Ophir Energy and BG Group Plc, its partner in the project, agreed to drill the three wells in an initial work program, he said. Tanzania Petroleum has asked them to expand the search with a fourth well, in Block 1, Halfani said.

“The way forward is to complete the drilling program by the end of this year or January, do additional seismic work, and then sit down with the operator and come up with a plan,” he said.

About 16 oil and gas exploration companies, including Maurel & Prom SA of France and Australia-based Key Petroleum Ltd., have signed 24 production-sharing agreements with the Tanzanian government, Halfani said on Oct. 29.

Two gas deposits are in commercial production in Tanzania. Songo Songo holds 1.5 trillion cubic feet of gas, while the Mnazi Bay field near the border with Mozambique has 2 trillion cubic feet of gas in place, according to Halfani.

To contact the reporter on this story: Sarah McGregor in Nairobi at smcgregor5@bloomberg.net.

To contact the editor responsible for this story: Antony Sguazzin in Johannesburg at asguazzin@bloomberg.net.

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