(Ecofin Agency) - Sasol has commenced the drilling of a third well in its production-sharing agreement area in Mozambique.

According to John Sichinga (photo), senior vice-president of Sasol Exploration and Production International, the company is making improvement on detailed design work for surface-processing facilities. He added that the first gas well had produced gas during well test and results were being evaluated to confirm the volumes. The second well in the northern section of Temane was completed in early October and work began on the third well, into an oil reservoir, on October 11 and Sasol will continue to invest in Mozambique as it was essential to the group’s geographic strategy.

Speaking during the Africa Oil Week in Cape Town, Sichinga said Sasol is planning to commission the $210m Loop Line 2 project in order to increase the capacity of the gas pipeline between South Africa and Mozambique. The company has also made financial arrangements of $1.4bn to drill for oil and gas in its production-sharing agreement area in southern Mozambique in the next two years.

This area which is close to the Pande and Temane fields, on which work began in May, contains two oil and two gas reservoirs.

Sasol is exploring the area in two phases, concentrating first on oil and gas afterwards. The phase 1, will involve 13 wells being drilled including one for water while the second-phase programme is subject on the results of the first, Business Day reports.

Sasol is concluding seismic studies on its two offshore licence areas in the Durban and Orange basins. The company has also discovered prospective basins in West Africa, where it has an interest in Gabon, Sichinga added.

Anita Fatunji