Upstream oil and gas business Sasol Petroleum International has completed a large part of its well-drilling campaign in Mozambique and is planning to drill another 27 wells by April 2008, in a programme that includes development appraisal and exploration wells.
This is in a bid to firm up its gas resource for use in fuels, chemicals and power ventures in both South Africa and Mozambique.
It has always been envisaged that gas production, and the associated infrastructure to transport the commodity within Mozambique and to South Africa, would be enlarged in phases, based on the availability of gas and the pace of market development.
The first phase has been a ramp-up to 120-million gigajoules yearly, which is close to being met, with some of the gas already being directed towards synfuels and chemicals production.
In the ramp-up from 120-million gigajoules to 183-million gigajoules, the Mozambique market is expected to absorb about 60% of the gas into power generation. If the planned increase to 240-million gigajoules is achieved, it is expected that both the Secunda complex and the Mozambican markets will benefit from the growth.
The immediate goal, though, is to raise output to 183-million gigajoules a year, and Sasol group GM Lean Strauss tells Engineering News that the feedstock for that level of production has already been proved for the next 20 years. The intention is, thus, to upscale the processing plant and production infrastructure to accommodate the new output level.
'Once we have achieved that milestone, we envisage that a significant portion will be used in Mozambique, primarily for power generation, while a lesser part will be directed towards Secunda, which is planning to increase its offtake.'
But also envisaged is a third phase to raise production to 240-million gigajoules yearly, and Sasol's exploration programme is now strongly aligned towards securing the necessary gas to meet that aspiration.
SECUNDA EXPANSION RELIANT ON GAS SECURITY
Prospecting success is vital for securing the necessary quantity of gas feedstock to expand the Secunda complex by about 15% or 24 000 bbl, which would require about 60-million gigajoules of gas a year.
'During the 2007/8 financial years we will be drilling a further 27 wells in Mozam-bique. We have also just completed seismic work for two offshore blocks in which we plan to conduct exploration drilling by 2008. We are looking forward to the outcome, because we believe there is definitely further gas to be found,' Strauss enthuses.
An environmental-impact assessment and the development of an environmental-management plan for the offshore programme, which will focus on blocks 16 and 19, have been completed.
This follows on from the 2005 signing of an offshore licence agreement between Sasol and the Mozambique government, following Sasol Petroleum International's onshore success at Temane and Pande.
The offshore gas is expected to be as 'sweet' as its onshore counterpart, free of carbon dioxide and hydrogen sulphide, with high energy content, a mere 2% of nonburning nitrogen and 95% methane.
Sasol's offshore company has an eight-year concession to explore Block 16 and Block 19, an area of 11 000 square kilometres where, hitherto, no wells have ever been drilled.
Guiding the programme will be seismic data acquired from previous contractors as well as a recently completed campaign by Sasol itself, through the seismic data gathering vessel, WesternGeco.
Sasol will also use onshore analogies ' gained during eight years of exploring in the Pande and Temane fields ' to guide its offshore exploration programme. Sasol owns 70% of the onshore Pande/Temane production-sharing area, while its partner, the State-owned ENH, owns the balance. On Block 16 and 19, Sasol and ENH own inte-rests of 85% and 15%, respectively.
The onshore seismic programme, meanwhile, has also revealed some high-potential targets that are now being pursued.
Sasol has been the primary driver of gas exploration since 1997 and its 865-km gas pipeline is currently supplying gas to Sasol in Secunda and Sasolburg and markets in South Africa. The company is active in the Inhambane and Sofala provinces, separated by the Save river.
Its activity, thus far, has helped to increase Mozambique's gross domestic product considerably and to provide South Africa with a new environment-friendly coal-replacing energy source.
But the exploration programme has not been without its challenges. For instance, seismic surveying in the shallow waters was postponed to allow further studies on the rela-tively vulnerable dugong population, a large marine mammal found in the area. The campaign was also opposed by tourism and fishing interests, given its proximity to the pristine Vilanculos area.
'A GTL project would totally depend on our finding sufficient gas,' Strauss asserts, adding that, owing to the GTL potential, the upstream business is now as focused on discovering gas as it has been, in the past, on finding oil.
Finding its own gas resource, rather than the current model of partnering with owners of gas reserves, is also an attractive prospect for Sasol. How-ever, Strauss stresses that Sasol is equally excited about the prospect of applying its GTL expertise in partnership with others, as is the case in Qatar, Nigeria and, potentially, Australia.
During the 2006/7 financial year, gas production in Mozambique climbed 4%, helping to raise Sasol Petroleum International's operating profit 14% to R826-million, before exploration costs of R526-million were deducted.
This significant increase in exploration spend, which was only R123-million in 2005/6, is likely to decrease somewhat in the current financial year, with a particular focus on developments in Mozambique and Nigeria.
'We are very pleased with our production profile in southern Gabon. Our board has now approved the development of the Ebouri field, which will kick in during 2008 and should help us sustain our current level of production.
'We are also now a full participant in the four blocks in the Nigerian region under the so-called area of mutual interest with Chevron. Three of these offshore blocks are in Nigeria and one, known as the joint development zone, lies between Nigeria and Sao Tome Principe. That work is progressing and we are also taking our share and paying our dues in those projects,' Strauss concludes.
This is in a bid to firm up its gas resource for use in fuels, chemicals and power ventures in both South Africa and Mozambique.
It has always been envisaged that gas production, and the associated infrastructure to transport the commodity within Mozambique and to South Africa, would be enlarged in phases, based on the availability of gas and the pace of market development.
The first phase has been a ramp-up to 120-million gigajoules yearly, which is close to being met, with some of the gas already being directed towards synfuels and chemicals production.
In the ramp-up from 120-million gigajoules to 183-million gigajoules, the Mozambique market is expected to absorb about 60% of the gas into power generation. If the planned increase to 240-million gigajoules is achieved, it is expected that both the Secunda complex and the Mozambican markets will benefit from the growth.
The immediate goal, though, is to raise output to 183-million gigajoules a year, and Sasol group GM Lean Strauss tells Engineering News that the feedstock for that level of production has already been proved for the next 20 years. The intention is, thus, to upscale the processing plant and production infrastructure to accommodate the new output level.
'Once we have achieved that milestone, we envisage that a significant portion will be used in Mozambique, primarily for power generation, while a lesser part will be directed towards Secunda, which is planning to increase its offtake.'
But also envisaged is a third phase to raise production to 240-million gigajoules yearly, and Sasol's exploration programme is now strongly aligned towards securing the necessary gas to meet that aspiration.
SECUNDA EXPANSION RELIANT ON GAS SECURITY
Prospecting success is vital for securing the necessary quantity of gas feedstock to expand the Secunda complex by about 15% or 24 000 bbl, which would require about 60-million gigajoules of gas a year.
'During the 2007/8 financial years we will be drilling a further 27 wells in Mozam-bique. We have also just completed seismic work for two offshore blocks in which we plan to conduct exploration drilling by 2008. We are looking forward to the outcome, because we believe there is definitely further gas to be found,' Strauss enthuses.
An environmental-impact assessment and the development of an environmental-management plan for the offshore programme, which will focus on blocks 16 and 19, have been completed.
This follows on from the 2005 signing of an offshore licence agreement between Sasol and the Mozambique government, following Sasol Petroleum International's onshore success at Temane and Pande.
The offshore gas is expected to be as 'sweet' as its onshore counterpart, free of carbon dioxide and hydrogen sulphide, with high energy content, a mere 2% of nonburning nitrogen and 95% methane.
Sasol's offshore company has an eight-year concession to explore Block 16 and Block 19, an area of 11 000 square kilometres where, hitherto, no wells have ever been drilled.
Guiding the programme will be seismic data acquired from previous contractors as well as a recently completed campaign by Sasol itself, through the seismic data gathering vessel, WesternGeco.
Sasol will also use onshore analogies ' gained during eight years of exploring in the Pande and Temane fields ' to guide its offshore exploration programme. Sasol owns 70% of the onshore Pande/Temane production-sharing area, while its partner, the State-owned ENH, owns the balance. On Block 16 and 19, Sasol and ENH own inte-rests of 85% and 15%, respectively.
The onshore seismic programme, meanwhile, has also revealed some high-potential targets that are now being pursued.
Sasol has been the primary driver of gas exploration since 1997 and its 865-km gas pipeline is currently supplying gas to Sasol in Secunda and Sasolburg and markets in South Africa. The company is active in the Inhambane and Sofala provinces, separated by the Save river.
Its activity, thus far, has helped to increase Mozambique's gross domestic product considerably and to provide South Africa with a new environment-friendly coal-replacing energy source.
But the exploration programme has not been without its challenges. For instance, seismic surveying in the shallow waters was postponed to allow further studies on the rela-tively vulnerable dugong population, a large marine mammal found in the area. The campaign was also opposed by tourism and fishing interests, given its proximity to the pristine Vilanculos area.
GTL POTENTIAL IN MOZAMBIQUE
However, the way is being cleared for both onshore and offshore prospecting, which, if successful, could possibly see Sasol pursuing a gas-to-liquids (GTL) investment in the country.'A GTL project would totally depend on our finding sufficient gas,' Strauss asserts, adding that, owing to the GTL potential, the upstream business is now as focused on discovering gas as it has been, in the past, on finding oil.
Finding its own gas resource, rather than the current model of partnering with owners of gas reserves, is also an attractive prospect for Sasol. How-ever, Strauss stresses that Sasol is equally excited about the prospect of applying its GTL expertise in partnership with others, as is the case in Qatar, Nigeria and, potentially, Australia.
During the 2006/7 financial year, gas production in Mozambique climbed 4%, helping to raise Sasol Petroleum International's operating profit 14% to R826-million, before exploration costs of R526-million were deducted.
This significant increase in exploration spend, which was only R123-million in 2005/6, is likely to decrease somewhat in the current financial year, with a particular focus on developments in Mozambique and Nigeria.
'We are very pleased with our production profile in southern Gabon. Our board has now approved the development of the Ebouri field, which will kick in during 2008 and should help us sustain our current level of production.
'We are also now a full participant in the four blocks in the Nigerian region under the so-called area of mutual interest with Chevron. Three of these offshore blocks are in Nigeria and one, known as the joint development zone, lies between Nigeria and Sao Tome Principe. That work is progressing and we are also taking our share and paying our dues in those projects,' Strauss concludes.