Australian junior Jacka Resources has been formally awarded a 100 per cent interest in a production sharing agreement covering the onshore Ruhuhu Block in south-west Tanzania, upstreamonline.com reported on Wednesday
Jacka was originally awarded exploration and production rights over the Ruhuhu basin last year but had to wait on formal final government approval.
The Tanzanian government placed a halt on licensing in the country last year as it reviewed oil and gas licence terms following major discoveries of gas offshore.
It is understood the PSA awarded to Jacka over the Ruhulu Block is the first to be granted by the government since the review of licence terms.
The terms of Jacka’s PSA carry an initial four-year exploration period, which will include the acquisition of airborne gravity and magnetics, the gathering of at least 400 kilometres of seismic and the drilling of one exploration well.
Jacka chairman Scott Spencer said the company believed there were similarities between the Ruhuhu basin and the oil rich Albertine Graben to the north in Uganda.
“The company has identified both conventional and unconventional oil and gas opportunities across the Ruhuhu, however, its initial focus will be on the conventional prospectivity in the western section of the basin,” he said.
“While the Ruhuhu basin has been highlighted as a prospective area of the East African Rift System, the same system that influences the Albertine Graben, no exploration drilling has been carried out in the basin to date. We look forward to changing that for the benefit of our shareholders and the people of Tanzania.”
Following the award of the PSA, Jacka plans to immediately start initial planning for the acquisition of the airborne gravity and magnetics.
The PSA covers 10,343 square kilometres in the Ruhuhu basin which abuts Lake Nyasa on the north-east shores and is one of a chain of Karoo basins across southern Africa.
An increasing number of discoveries off the coast of Tanzania over the past 12 to 18 months has seen a string of international players flock to the east African nation, with large companies such as Shell, Statoil, Total, Petrobras, ExxonMobil and Tullow Oil all holding acreage in the country.