Swala Energy to Relinquish Tanzania’s Pangani License

Australian oil and gas exploration company Swala Energy has reported it has notified  the Tanzania Petroleum Development Corporation together with partners Tata Petrodyne and Otto energy its desire to relinquish the Pangani licence after the technical review of the licence showed no structures of commercial interest.

The Pangani licence a large frontier licence (17,156km2) located in the Pangani Rift, on one arm of the Northern Tanzanian Divergence triple junction is part of the East African Rift System that, in the west, runs from Uganda to Malawi, and in the east from Kenya to Tanzania.

Swala had earlier indicated that it believed the Pangani Rift to contain sediments of Pliocene age, and possibly some Late Tertiary successions.

Between mid-November and late December 2013 the Company acquired 200km of 2D seismic over the Moshi and Mvungwe basins, two basins within the Pangani licence that had been identified from interpretation of the gravity-magnetic results acquired by Swala’s 2012 airborne survey.

During 2014 the Company acquired a further 200km of 2D seismic over the Moshi basin, fulfilling its work commitments for the Third Contract Year.

Elsewhere in the Kilombero basin, GCA has re-assessed the magnitude of the Kito prospect and estimated the prospective resources of a further four leads identified during the 2014 seismic campaign.

The analysis was based on newer seismic data and increases the best estimate gross Kito prospective resources to 97 mmstb (11.3mmstb net to Swala on a working interest basis) in the Basal Sandstone and 87 mmstb (10.2 mmstb net to Swala on a working interest basis) in the Sequence 1 sandstone – see Table 1.

GCA’s estimates of gross prospective resources in the additional leads are shown in Table 2.

Swala Oil & Gas (Tanzania) plc (“Swala Tanzania”), in which Swala has a 58.5% equity interest, has completed the tender process of the long lead items for the Kito-1 well and has issued invitations to tender to a number of regionally-based drilling contractors for submissions during March 2016.