Statoil Tanzania plan Multi-Billion Dollar LNG Plant after Tanzania Gas Find

A USD10 billion Liquefied Natural Gas (LNG) terminal is being planned by Statoil and Britain’s BG Group after the company made a new find in offshore Tanzania.

“We have enough gas to move forward” Statoil’s Head of Exploration Tim Dodson said, after the anouncement of discovering 4-6 trillion cubic feet of gas in the Indian Ocean.

“We are working with BG to come up with a recommendation for a landing site. We should be making that recommendation to Tanzanian authorities fairly early in the second quarter,” Dodson told Reuters.

The latest find, Statoil’s third in the area within one year brings its total recoverable resources there to 10-13 trillion cubic feet.

BG has interests in three blocks off Tanzania together with Ophir Energy.

Tanzania is attractive to oil companies because of its relative proximity to Asia’s big LNG consumers.

To permit exports of fuel, there will be a need for plants to turn gas into freezing liquid to ship to major Asian markets. Statoil with BG are on course to build one of the first.

Dodson said $10 billion was a fair estimate for the cost of developing the plant.

An investment decision would be at least three years away, not before early 2016 he added.

The Tanzania government is pleased to learn about additional gas resources discovered in Block 2 and remains optimistic on future developments.

Statoil operates the licence on Block 2 on behalf of Tanzania Petroleum Development Corporation (TPDC) and has a 65% working interest with ExxonMobil Exploration and Production Tanzania Limited holding the remaining 35%.

Statoil has been in Tanzania since 2007 when it was awarded the operatorship for Block 2.