Pan African Energy Supplies Extra Gas To Tanzania in New Short Term Sales Agreement

Orca has announced that shortly before the year ended its Tanzania subsidiary Pan African Energy Tanzania Limited signed a short-term sales agreement with the Tanzania Petroleum Development Corporation (TPDC) and the Tanzania Electric Supply Company (TANESCO) for the immediate supply of gas to TANESCO of up to 35 million standard cubic feet per day.

These additional volumes are being processed and transported through TPDC’s National Natural Gas Infrastructure and will allow TANESCO to generate increased and more stable power to meet emerging demand.

First gas flowed through the NNGI on 24 December and production averaged 20 MMscf/d in the first ten days of operation. Total Additional Gas sales, including those through the Songas gas processing and transportation system, averaged 56 MMscf/d over the same period. This compares to an average for the third quarter of 44 MMscf/d.

The Agreement provides a mechanism for the parties to agree to one-month extensions for a maximum term of six months and is expected to be superseded by a long-term agreement.

“We have worked very closely with TPDC and TANESCO to ensure that Songo Songo natural gas is available for electricity and industrial demand on a timely basis. It has been made possible by the field work programme that was completed by the Company in 2016 and the construction of extensive gas processing and pipeline infrastructure capacity by TPDC and the Government of Tanzania that was commissioned in the same year. We look forward to working with all parties to ensure that affordable indigenous gas continues to be a significant proportion of the energy mix in Tanzania,” Nigel Friend, CEO of Orca, commented.

PAET can supply these additional volumes from its existing well stock.Already two wells, SS-11 and SS12 are tied into the NNGI and SS-10 will be connected if required to meet demand. PAET is currently in the process of installing a refrigeration package as part of the Songas Facilities to ensure that gas can continue to be processed at the plant’s capacity. It is expected that this will be operational by mid-2019.