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Tanzania says Total close to signing exploration agreement
DAR ES SALAAM, Sept 6 |
DAR ES SALAAM, Sept 6 (Reuters) - French oil major Total is close to signing a deal to explore for oil and gas in Tanzania's Lake Tanganyika, a senior Tanzanian petroleum official said on Thursday.
Total won a bidding round against eight other companies in August 2011 to explore the block but has been unable to do any work in the area while it discussed terms of a production sharing agreement (PSA) with the government.
"Total is in the very late stages of negotiation," Meshack Kagya, senior principal petroleum geochemist at the state-run Tanzania Petroleum Development Corp., told a gas conference.
Tanzania, east Africa's second-biggest economy, became a player in energy this year with several onshore and offshore gas finds, attracting multinational explorers to the area.
The country reportedly has about 30 trillion cubic feet of gas, which could make it a major energy exporter.
Total's PSA application is one of six the government is currently processing for companies. Two PSAs are for onshore blocks, and the others are for deep sea exploration spots.
Lake Tanganyika, where Total's new exploration area lies, sits on the western border of Tanzania and the eastern border of the Democratic Republic of the Congo.
Bodies of water that sit on onshore borders have been notoriously hard to explore as disputes over who owns the resources beneath lakes and rivers often erupt between countries.
In July, Tanzanian authorities asked UK explorer Surestream Petroleum, which Malawi authorities had licensed, to stop drilling on Lake Malawi. That dispute is ongoing.
Kagya said Tanzania was hoping to make more exploration blocks available soon, though he acknowledged it would take time. A licensing round that was supposed to take place in Houston, Texas this month was delayed and will be rescheduled in the near future.
"It has been delayed for some technical and housekeeping reasons," he said. (Reporting by Kelly Gliblom; Editing by Yara Bayoumy and Jane Baird)
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