BG Group in Tanzania

BG Group Plc engages in the exploration, development and production of natural gas and oil. Its main area of operation is through upstream and LNG shipping and marketing segments. Operating in more than 20 countries with a multidisciplinary workforce of more than 5000 workers from 70 nationalities, the firm has a presence on every continent of the world.

Operations in Africa
On the African continent, BG Group operates in Tunisia at the Miskar field and Hasdrubal onshore gas processing facility, while in Egypt it is involved all the way from exploration, development and production to LNG at West Delta Deep Marine (WDDM) and Rosetta.

In October 2013, BG president in Tunisia, Michael Rees, noted that the country had become a more reliable place to produce natural gas than Egypt with its political challenges, because the former pays its bills on time and, in October 2014, Egypt paid BG $350 million to reduce what it owes the Reading based firm to around $1.2 billion.

In neighboring Kenya, BG Group operates Block-L10A in partnership with PTT Exploration and Public Company Ltd (PTTEP) and Pancontinental Oil and Gas NL, with interests of 50 per cent, 31.25 per cent and 18.75, respectively and 75 per cent interest in Block L10B.

BG Group also operates in Madagascar where it holds a 30 per cent interest in Majunga offshore Profond Exploration Block, with the other partners being ExxonMobil Exploration/Production Madagascar Majunga Ltd (50 per cent) and SK Corporation of Korea (20 per cent).

East Africa Operations
East Africa may play host to oil production after BG Group and its partners announced in the second week of June 2014 that they had discovered the presence of the liquid gold off the Lamu basin in Block-L10A.

According Pancontinental CEO, Barry Rushworth, the discovery at Sunbird-1 well was the first offshore oil discovery to have ever been reported on the eastern Africa coastal area, stretching from South Africa to the northwestern tip of Somalia.

BG Operations in Tanzania
BG Group came to Tanzania in 2010 when it farmed in to Ophir Energy held assets by taking a 60 per cent working interest, and had by the third year (2013) of operations hit nine natural gas discoveries and the trend has continued.

The firm farmed in to Blocks-1(Taachi-well, Mzia-well, Chaza-well, Jodari-1 well, Mkizi-well), Block-3(Papa-well), and Block-4 (Chewa-well, Ngisi-well and Pweza-well), all previously operated 100 per cent by Ophir Energy, since 2007.

The two companies have continued to operate the blocks, with the former as the operator, even though this would change for Block-3 when the latter increases its stake in the block after taking over what was held by BG Group.

As of September 25th 2014, BG Group has withdrawn from Block-3 stating that the block where gas was discovered in 2012 at the Papa well was not very appealing to the company to proceed to the next stage of development.

The rate at which natural gas was being discovered in Tanzania was fast, making the country become a major gas producer and candidate for the possibility of putting up an LNG processing plant in the region, with BG Group being one of the major players in these discoveries in Block-1, 3 and 4 in partnership with Ophir Energy.

BG Group Tanzania with its partner Ophir Energy, have now invested over US$ 1 billion in a fast-track exploration appraisal (E&A) programme.

BG Group and Local Skills Development
Following the general lack of skilled manpower in the oil and gas sector, Tanzania has through its ministry of energy realised the importance of having the requisite human capital in the gas and oil sector by committing funding to train and educate, locally and abroad, local expertise to fully participate in running the sector.

Minister for Energy and Minerals, Prof. Sospeter Muhongo, says the government has a Marshall plan to have a critical mass of well trained Tanzanians in the nascent gas and oil sector.

Taking cue from the government, BG Group says it is committed to contributing positively to the lives, communities and economy of Tanzania, with sponsorship of students being one of the initiatives.

BG Group sponsored two students to do their MA at Newcastle and Dundee Universities, whereby their courses commenced in September 2012. In 2013 it signed a global partnership agreement with UK registered charity Youth Business International (YBI) to foster youth entrepreneurship, employment, and economic growth in countries where it operates.

Under the programme, it is estimated that businesses to be created by the first 15,000 entrepreneurs would, in turn, lead to the generation of 45,000 extra employment opportunities after five years of working together.

It also continued to run programmes to promote skills and build employment in Tanzania, (in collaboration with Vocational and Educational Training Authority), and this year (2014) it launched a scheme for international postgraduate scholarships for geosciences engineering by offering 10 scholarships for graduates to study Masters of Science degrees relevant to the oil and gas industry.

Early this month (October, 2014), BG committed to continue sponsoring graduates to study for Masters of Science degrees locally at the Nelson Mandela Africa Institute of Science and Technology in Arusha.

BG Tanzania LNG and Upstream Vice-President, Mr. Adam Prince, said this was the company’s ongoing support to build capacity at a local level, which was complimenting BG’s international scholarship programme, which affords Tanzanians to study at established UK universities. =Reference=