Omani energy JV wins licence for Tanzanian gas field

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ARA Petroleum has announced that its joint venture has secured a 25-year development licence from Tanzanian Ministry of Energy for the country's largest onshore gas development - Ntorya Gas Field.

Formed in 2014, ARA Petroleum is part of the wider Zubair Corporation, one of the oldest business groups from Oman with broad interests across sectors in the Middle East, Africa and beyond.

The development licence was received by the operator of the Ruvuma JV, ARA Petroleum Tanzania Limited (APT), a wholly owned subsidiary of ARA Petroleum.

The award of the Development Licence allows APT to proceed with Tanzania’s largest onshore gas development with the goal of producing gas for the growing domestic market in the next year, said a top official.

"We are delighted to receive this licence from the Ministry of Energy and thank all the Tanzanian agencies involved in achieving this major milestone," remarked Erhan Saygi, General Manager of APT.

"We are ready to launch work immediately to bring this onshore development project into production," he added.

APT has prepared a field development plan that includes, but is not limited to, converting an existing well into a producing well, building in-field gas processing facilities and contracting a rig operator to drill a third well to appraise the field further.

APT expects to produce 40 million standard cu ft a day (mmscf/d) in the first year of production and to increase that to 140 mmscf/d within a few years’ time, according to a Gas Sales Agreement signed with the Tanzanian Petroleum Development Corporation (TPDC) earlier this year.

According to Saygi, such volumes will increase Tanzanian gas production significantly.

Additionally, APT believes the potential for gas production from the field is far larger having commissioned, acquired and interpretated 338 km2 of 3D seismic data over the Ruvuma JV licence area.

Following the interpretation of the seismic data, APT considers the area to yield a matured unaudited Contingent Resource estimate of 3.45 trillion cu ft (tcf) of Gas Initially In Place (GIIP), with an mean unrisked GIIP potential of 16.4 tcf and a risked mean potential of 6.9 tcf for the wider Ruvuma JV area.

Acknowledging this wider potential, the Development Licence divides the original "Mtwara Exploration Licence" area into nine blocks: five blocks containing the Ntorya discovery and four blocks labelled as 'adjoining blocks.'

The Ruvuma JV parties are required to undertake geological, geophysical and geochemical studies in the area and drill at least one additional exploration well within five years while spending a minimum of $10 million.

"We are excited about further exploration and appraisal work in this area as we consider it to hold truly enormous volumes of gas," noted Saygi.

"We believe the Ntorya gas field and wider area could be game-changing for Tanzania’s efforts to alleviate energy poverty, spur further economic development and potentially transform the country into a regional energy hub," he added.

ARA is a full cycle E&P company which explores, appraises, develops and produces oil & gas resources both in Oman and internationally.

With over 200 professionals based in Muscat, ARA has affiliated offices in Dar es Salaam, Trondheim and London.