Progress Stalls on Shell-Equinor $42-Billion LNG Project in Tanzania
02.29.2024 By Tank Terminals - NEWS

February 29, 2024 [Oil Price]- Shell and Equinor are still expecting the signing of all agreements which would allow them to start developing a planned $42-billion LNG export project in Tanzania, the international majors have told Bloomberg.

 

The LNG project for connecting offshore natural gas discoveries offshore Tanzania with an export terminal on its coast has been nearly a decade in the making.

After buying BG Group in 2016, Shell became the operator of two offshore blocks in Tanzania, Block 1 and Block 4, together with its partners Medco Energi (Ophir Energy) and Pavilion Energy. A total of 16 trillion cubic feet (Tcf) of natural gas have been discovered in the blocks.

Equinor, for its part, started exploration drilling activities in Block 2 offshore Tanzania in 2011 and has made nine discoveries with estimated volumes of more than 20 Tcf of gas in place.

Regulatory hurdles have weighed on the LNG plans, but progress was made in early 2023 and the majors felt they could start monetizing the huge offshore gas resources in the late 2020s or early 2030s.

Discussions with Shell and Equinor were completed and the experts were about to begin drafting contracts, the energy ministry of Tanzania said in March last year.

One contract is being drafted for the Host Government Agreement, and another is for blocks 1, 2, and 4, which will provide natural gas for the LNG project, Tanzania said at the time.

However, since May 2023, “progress has indeed been slower than we expected,” Equinor spokesperson Ola Morten Aanestad told Bloomberg this week.

“As the world’s energy system is slowly transitioning from oil and gas, we hope to advance Tanzania LNG – an attractive project in many respects – on time.” A spokesperson for Shell told Bloomberg that “We had hoped to see these agreements signed faster, but we remain ready to continue to work with the government on competitive and investable agreements, consistent with what we agreed last year.”

Tanzania’s Energy Minister Doto Biteko, told Bloomberg the host government agreement “is still under negotiation,” declining to discuss details.

 

Free Trial: Access 13,300 Tank Terminal and Production Facilities

13,300 tank storage and production facilities as per the date of this article. Click on the button and register to get instant access to actionable tank storage industry data

Enbridge's Q3 Profit More than Doubles on Acquisition Contributions
11.04.2024 - NEWS
November 04, 2024 [Reuters]- Enbridge’s third-quarter profit more than doubled from a year... Read More
Aramco and Petrovietnam Sign Agreement to Explore Energy Cooperation
11.04.2024 - NEWS
November 04, 2024 [Yahoo Finance]- Aramco has entered into a Collaboration Framework Agreement wi... Read More
Shell's $6 Billion Profit Smashes Forecasts as LNG Offsets Weak Refining
11.04.2024 - NEWS
November 04, 2024 [Reuters]- Shell reported on Thursday third-quarter profits of $6 billion that... Read More
PBF Energy Posts Weak Q3 Results, Set to Cut $200 Million of Costs in 2025
11.04.2024 - NEWS
November 04, 2024 [Reuters]- U.S. refiner PBF Energy plans to save around $200 million in operat... Read More