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Royal Dutch Shell Plc jointly with Pavilion Energy Pte Ltd and Ophir Energy Plc have completed drilling two offshore natural gas wells in southern Tanzania.

Netherlands-based Shell, which took over the global operations of BG Group last year, jointly owns deep sea blocks 1, 3 and 4 with Pavilion of Singapore and Ophir of Britain.

The joint venture partners started drilling Kitatange-1 well in block 1 and Bunju-1 well in block 4 in the Mafia Basin in early November 2016 at a cost of $80 million to meet exploration commitments signed with the government.

“After evaluation, Shell, which is the operator of blocks 1 and 4, has confirmed a good quality reservoir in both wells but hydrocarbons were not found,” said Ophir’s chief executive officer Nick Cooper. He added that Noble Globe Trotter 2 rig had been demobilised from the Mafia basin site and the two wells had fulfilled their final exploration commitments in accordance with the licences issued by the Ministry of Energy.

Shell, together with other partners, took advantage of reduced exploration costs due to low crude oil prices of below $50 a barrel to drill the two wells in block 1 and 4 where commercial natural gas deposits exist.

Potential for development is improved by wells that are close to sub-sea infrastructure such as the onshore $30 billion natural gas processing plant and liquefied natural gas export terminal to be built by exploration firms on 2,071.705 hectares of land in Likong’o in Lindi town.

The government has provided the 2,071.705 hectares of land in Likong’o for the gas liquefaction plant and liquefied natural gas export terminal. Since his election in 2015, Tanzania’s President John Magufuli has taken a hands-on approach in pushing for the gas liquefaction plant and the LNG export terminal project.

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