Tuesday, November 25, 2008

Natural Gas Fields Discovered in Mozambique

MAPUTO, Nov 24 (Reuters) - Mozambique said on Monday it had found two new natural gas fields in the southern Inhambane province which, if commercially viable, would supply domestic and regional markets.

"If it is viable, this discovery will make it possible to respond to domestic demand for natural gas," Mineral Resources Minister Esperanca Bias told reporters.

"We have a list of projects that could possibly be supplied, such as generating electricity, setting up a fertiliser factory and use in vehicles."

Gas exploration at the Njika-1 well in Mozambique began on Oct. 1, 2008. The project is a joint venture between South Africa's Sasol (SOLJ.J: Quote, Profile, Research, Stock Buzz), Malaysia's Petronas [PETR.UL] and the Mozambican government.

Under Mozambican law, the consortium that has discovered the gas reserves has six months to assess its findings and present a report to the government.

Sasol, the world's biggest maker of diesel from coal, owns 50 percent of the project, Petronas owns 35 percent, while the government of Mozambique holds 15 percent through national oil company Empresa Nacional De Hidrocarbonetos De Mozambique (ENH).

The two blocks, 16 and 19, were granted to the consortium in June 2005.

Mozambique currently has available around 140 million gigajoules of gas at the Pande/Temane reserves in the same province, used to supply both the domestic and regional markets.

Sasol has invested $1.2 billion to explore these gas fields, and plans to spend an additional $146.8 million to increase gas exports to South Africa by 20 percent in 2009. (Reporting by Charles Mangwiro, editing by Anthony Barker)

No comments: