ARA Petroleum to develop Tanzania’s largest onshore natural gas discovery

 ARA Petroleum announced that the Ministry of Energy in Tanzania has granted a 25-year Development Licence over the Ntorya natural gas discovery area to the Ruvuma joint venture. 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 natural gas development with the goal of producing gas for the growing domestic market in the next year. “We are delighted to receive this licence from the Ministry of Energy and thank all the Tanzanian agencies involved in achieving this major milestone. We are ready to launch work immediately to bring this onshore development project into production,” said Erhan Saygi, General Manager of APT.

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 MMcfd in the first year of production and to increase that to 140 MMcfd within a few years’ time, according to a Gas Sales Agreement signed with the Tanzanian Petroleum Development Corporation (TPDC) earlier this year. Such volumes will increase Tanzanian natural 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 Tcd 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 5 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. 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,” APT General Manager Erhan Saygi said.