22 C
Georgetown
Monday, April 12, 2021

Shell farms into South Africa deepwater acreage

Must Read

For Guyana, retaining the resource-rich Essequibo region ‘is a life-or-death matter’ – Ivelaw Griffith

Ivelaw Lloyd Griffith, former Vice Chancellor of the University of Guyana and Senior Associate with the Center for Strategic...

Canada-Guyana Chamber says now is the time to invest in economy projected to be world’s most oil intensive by 2025

The expanding oil and gas operations in Guyana will have a significant impact on other industries in the country,...

Touchstone confirms ‘liquids rich’ natural gas discovery in Trinidad and Tobago

Canada-based oil and gas company Touchstone Exploration Inc. said on Monday the completion of flowback testing of the Cascadura...
OilNOW
OilNow is an online-based Information and Resource Centre which serves to complement the work of all stakeholders in the oil and gas sector in Guyana.

(S&P Global Platts) Shell has farmed in to South African deepwater exploration blocks days after Total announced a second gas and condensate discovery nearby, as interest grows in a potential new gas condensate hub off the country’s south coast, Shell and partner company Africa Oil said Nov. 4.

Shell is purchasing 50% stakes and the right to operate the Transkei and Algoa blocks, the latter located in the same basin as Total’s 2019 Brulpadda discovery and its October Luiperd discovery, Vancouver-based Africa Oil said in a statement. Africa Oil added it is a 31% shareholder in privately owned explorer Impact Oil & Gas, with which Shell has signed the farm-in agreements.

The Transkei block is in a different, nearby geological basin, where “Impact has identified highly material prospectivity associated with several large submarine fan bodies, which this joint venture will explore with focused 3D seismic data and then potential exploratory drilling,” Africa Oil said.

A Shell spokesman said: “This deal is in line with our exploration strategy to selectively add new exploration basins to our global portfolio.”

Recent discoveries raise hopes of a new push for gas in South Africa’s coal-dominated energy sector.

Shell has not been involved in developing neighboring Mozambique’s major gas resources, primarily intended for LNG export, but is a partner in a delayed gas project offshore Tanzania.

Total’s Luiperd well encountered 73 meters of net gas condensate pay in “well-developed good quality” reservoirs, coming after Brulpadda was classed as one of the world’s biggest hydrocarbon finds of 2019. “This discovery and the successful seismic acquisitions…will help to progress development studies and engage with South African authorities regarding the possible conditions of the gas commercialization,” Total’s upstream head, Arnaud Breuillac, said Oct. 28.

Africa Oil holds a 49% stake in Main Street, holder of a 10% stake in the 11B/12B block where Brulpadda and Luiperd are located. It added Nov. 4 that it was expanding its acreage holding in the area, via Impact Oil & Gas, with a farm-in agreement to take a 90% stake in Area 2, immediately adjacent to Algoa and Transkei.

“We continue to be very pleased with our portfolio of equity investments, especially with the recent Luiperd discovery on Block 11B/12B… The entry of Shell into Impact’s Transkei & Algoa license is a confirmation of this strategy and with the addition of Area 2 we now have an industry-leading acreage position in this exciting new region,” Africa Oil CEO Keith Hill said. “All of our portfolio companies, Impact, Africa Energy and Eco Atlantic are well financed, and we do not expect them to raise any additional equity in the foreseeable future.”

Total operates block 11B/12B with a 45% working interest, alongside Qatar Petroleum (25%), Canada’s CNR international (20%) and Main Street.

The French major also operates the adjacent, even larger Outeniqua South block which has yet to be drilled and extends out to water depths of more than 4,000 meters.

The Luiperd discovery well will be tested to assess the reservoir characteristics and flow rates over the next few weeks following a well coring and logging program, the partners in that find said earlier.

African gas

South Africa’s new-found gas condensate resources in the area are expected to kickstart the country’s gas-to-power program and help replenish gas supply to the Mossel Bay gas-to-liquids plant. The South African government has voiced concerns that the PetroSA GTL plant at Mossel Bay could run out of natural gas within two years when the existing offshore reserves dry up.

If the production from the finds is used as a feedstock for its gas-to-power plants, that will reduce or eliminates the need for South Africa to import LNG or construct additional pipelines from Mozambique.

Meanwhile Tanzania plans this month to resume talks aimed at kick-starting the construction of a planned $30 billion LNG export facility in the southeast African country, the head of the Tanzania Petroleum Development Corporation (TPDC) said Oct. 5, ahead of Oct. 28 presidential and parliamentary elections.

Shell, Norway ‘s Equinor, ExxonMobil, Indonesia ‘s MedcoEnergi and Singapore-based Pavilion Energy have been working to develop an LNG plant at Lindi but talks with the government stalled last year.

OilNOW TV

Latest News

Canada-Guyana Chamber says now is the time to invest in economy projected to be world’s most oil intensive by 2025

The expanding oil and gas operations in Guyana will have a significant impact on other industries in the country,...

For Guyana, retaining the resource-rich Essequibo region ‘is a life-or-death matter’ – Ivelaw Griffith

Ivelaw Lloyd Griffith, former Vice Chancellor of the University of Guyana and Senior Associate with the Center for Strategic and International Studies says a...

Total, CNOOC enter agreements with Uganda and Tanzania for $3.5 billion pipeline

(Reuters) -Uganda, Tanzania and oil firms Total and CNOOC on Sunday signed agreements that will kickstart the construction of a $3.5 billion crude pipeline...

Touchstone confirms ‘liquids rich’ natural gas discovery in Trinidad and Tobago

Canada-based oil and gas company Touchstone Exploration Inc. said on Monday the completion of flowback testing of the Cascadura Deep-1 well in Trinidad and...

Exxon’s Greater Guyana Initiative brings Zoom Rooms project to University of Guyana

The University of Guyana (UG) on Saturday launched its Zoom Rooms project which it says lays down the first building blocks for its blended-learning...

More Articles Like This