The US Geological Survey estimates the area from East Africa’s coastal region and stretching out off-shore to the Seychelles holds 441 trillion cubic feet of natural gas which said to be twice as much as Saudi Arabia’s holdings.
The recent gas discoveries in Mozambique are adding up quickly. Al Arabiya News quotes Duncan Clarke, CEO of the oil consulting company Global Pacific:
“Houston-based Anadarko in June announced new finds in northern Mozambique which brought its estimated recoverable resources to up to 60 trillion cubic feet. The company has proposed $15 billion in investments to set up LNG facilities. Mozambique’s GDP last year was $12 billion.
Thailand’s PTT Exploration and Production in May announced a $1.9-billion deal to buy Cove Energy, whose 8.5-percent stake in the Mozambican fields is currently up for sale. Two weeks earlier Italy’s ENI, the other large operator in the country’s Rovuma basin, said recent discoveries boosted its recoverable resources up to 52 trillion cubic feet. ”
Tim Dodson, vice president for exploration at Norway’s Statoil on the company website said that Statoil and Britain’s BG together have discovered around 16 trillion cubic feet in Tanzania.
There are issues for the development of these fields including availability of infrastructure (sea and air ports, roads, housing, etc), lack of skilled work forces, and up-dated petroleum legislation. There is another concern according to Silas Olang, East African coordinator from resources watchdog Revenue Watch Institute, “Corruption is a big challenge.”
We are hearing more of plans to build of new facilities to liquefy natural gas and ports to store and ship the LNG around the world. Will the price of gas get so low due to availability of their own indigenous sources that the markets for this gas from East Africa might take years to develop? If the Europeans continue to resist fracking, that part of the world might be a market for East African LNG. Russia is certainly going to make for stiff competition for the European market as they have pipelines delivering gas to Europe right now.
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