Aberdeen — The Mozambican government is aiming for “optimal resource recovery of all petroleum resources, including natural gas”, declared Arsenio Mabote, the chairperson of the National Petroleum Institute (INP), in the Scottish city of Aberdeen on Thursday.

Speaking at the Conference on Infrastructure Development in the Oil and Gas Industry in Mozambique, Mabote said that policy fundamentals included “securing resource rent, allowing industrial development, and retaining an efficient petroleum regulatory and administrative regime”.

He pointed out that there are two main sedimentary basins in Mozambique, where hydrocarbon deposits could be found. The better known of these is the Rovuma Basin in the far north of the country, covering 17,000 square kilometres onshore and 12,500 square kilometres offshore.

It is in the offshore region that the recent spectacular discoveries of gas have been made by consortia headed by the American company Anadarko, and ENI of Italy. Mabote pointed out that the wells drilled so far have made some ten discoveries, within a relatively small area with a radius of about 50 kilometres.

The implication is that there could be much more gas (and possibly oil) still to be discovered in the Rovuma Basin.

The Mozambique Basin is much larger, covering half a million square kilometres of the central and southern Mozambican coastal plan and continental shelf, stretching from the Zambezi Delta to the border with South Africa. It was here that the country's first gas fields were discovered, in the 1960s, at Pande and Temane in Inhambane province. But exploitation of these resources, by the South African petro-chemical giant Sasol, only began in 2004.

The known reserves at Pande and Temane are 3.5 trillion cubic feet of gas, dwarfed by the 185 trillion cubic feet so far discovered in the Rovuma basin. But the Mozambique Basin remains largely unexplored, with few exploratory wells drilled so far.

The immediate tasks for the Rovuma basin, said Mabote, are to build the facilities for producing liquefied natural gas (LNG), drill the development wells, install subsea architecture, and secure shipping agreements.

He pointed out that Anadarko and ENI will have to reach agreement on sharing gas reserves - the discoveries the two consortia have made are probably interconnected.

Mabote said that further offshore seismic data, for both the Rovuma and the Mozambique basins, is being acquired, and this data will be used as the basis for forthcoming licensing rounds.

In addition to constructing the facilities to produce LNG for export, the challenges facing the government, he added, include the local processing of natural gas for industrial products, guaranteeing competitive prices for natural gas on the local marker, the training and employment of Mozambican staff in gas related industries, and ensuring local content in the provision of goods and services.

The chairperson of the National Hydrocarbons Company (ENH), Nelson Ocuane, pointed out that the hydrocarbon potential of all of east Africa is underdeveloped, with less than 600 exploratory wells drilled (94 of them in Mozambique). This compares with 19,000 exploratory wells in north Africa and 14,600 in west Africa.

Ocuane pointed to the potential use of natural gas to produce fertilisers. Mozambican farmers currently use very small amounts of fertiliser - an average of only three kilos per hectare, which compares with a 10.5 kilo average in sub-Saharan Africa, and the world figure of 122 kilos per hectare.