(Dow Jones Newswires), Aug. 16, 2011
Tanzania's state oil company, Tanzania Petroleum Development Corp., has awarded rights to explore for oil and gas in its Lake Tanganyika Rift Basin to France's Total E&P Activities Petrolieres, with further negotiations and details on a production sharing agreement to follow, TPDC announced Tuesday.
"Total has shown itself to be able to comply with the minimum work commitment and has superior technical as well as financial capability over the other bidders to undertake exploration in the Lake Tanganyika North area," TPDC said. Total beat at least four other companies.
The Lake Tanganyika Rift Basin is part of the western arm of the East African rift valley, where at least a billion barrels of oil have been discovered in neighboring Uganda.
The Lake Tanganyika rift basin is divided into two blocks. Total will operate the northern block. The Southern block was awarded to Australia's Beach Energy in 2008.
Next year, Tanzania will open another bidding round for at least 13 blocks sitting between 1,200 meters and 3,500 meters of water depth off its coast in the Indian Ocean.
However, in recent months, licensing and exploration activities off the Tanzanian coast have been overshadowed by disputes between mainland Tanzania and the semi-autonomous archipelago of Zanzibar over the control of oil and gas in around five blocks near the isles.
Currently, Tanzania has licensed 12 deepwater blocks and recent exploration works have encountered at least 7.5 trillion cubic feet of natural gas. The country is yet to discover commercial oil reserves.
At the moment, there are no production projections Tanganyika project since no discoveries have been made, and formal exploration has yet to commence.
Copyright (c) 2011 Dow Jones & Company, Inc.
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