Statoil Makes Third Offshore Tanzania Discovery

Statoil has made a new natural gas discovery offshore Tanzania with the Lavani-2 exploration and appraisal well, the company reported Friday.

Lavani-2, which marks Statoil's third discovery offshore Tanzania, successfully appraised the Lavani-1 discovery reservoir in the Paleogene. Statoil encountered a separate and significant gas-bearing reservoir in the Cretaceous when the well was deepened to its second target.

The well was drilled by Ocean Rig Poseidon (UDW drillship) in 8,464 feet (2,580 meters) of water to a total depth of 17,290 feet (5,270 meters). Lavani-2 is located about 3.1 miles (5 kilometers) southeast of the Lavani-1 discovery well and 12.5 miles (20 kilometers) south of the Zafarani-1 well.

"The Lavani-2 is the third well in an ambitious drilling campaign of four wells within one year," said Nick Maden, senior vice president of Exploration International in Statoil, in a statement. "The next well will be the appraisal of the Zafarani discovery. In parallel, the venture is acquiring new 3D seismic to help us identify additional targets in Block 2."

Statoil is operator of the Block 2 license on behalf of Tanzania Petroleum Development Corporation with a 65-percent working interest. ExxonMobil Exploration and Production Tanzania Limited holds the remaining 35 percent.

An increase in the block's upside potential is expected following further evaluations of the well. Statoil and partner ExxonMobil expect to announce updated total volumes in Block 2 in 2013.

Statoil entered Tanzania in 2007 with the award of the Block 2 license. Block 2 encompasses an area of approximately 59,201 square feet (5,500 square meters) and lies in water depths between 4,921 feet and 9,842 feet (1,500 to 3,000 meters), according to Statoil's website. The discoveries made to date by Statoil and ExxonMobil have proved up to 9 trillion cubic feet of gas in place and mark an important step towards a potential natural gas development in Tanzania. No wells had been drilled in this frontier area before 2010.

The company also is active in Mozambique in East Africa, where it is operator of Blocks 2 and 5 in the Rovuma Basin, another frontier area for exploration and production.

The global oil and gas industry has grown increasingly interested in East Africa and its significant natural gas reserves, which will serve as the basis for liquefied natural gas projects.


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