ABN - South African petrochemicals firm Sasol (JSE:SOL) is confident that it has located plentiful reserves of oil and gas off the coast of Southern African nation Mozambique.
The discovery could provide a boost to Mozambique’s economy which has been crippled by a financial debt crisis which has left the country as one of the poorest in the world.
However, Sasol remains committed to Mozambique’s hydrocarbon industry and has been buoyed by the surprising results of recent offshore drilling.
"We always expected to see both oil and gas. We have drilled four wells, two of them gas, two of them oil, all showing positive results,” said Sasol joint chief executive Stephen Cornell.
“In one of the areas where we expected mostly gas we found gas and oil," added Cornell.
Following the drilling results, the company has issued a notice of discovery to the Mozambican authorities.
Mozambique’s economy has been forecasted to slightly recover in 2017 with a growth of 4.2%, after recording the lowest economic growth in 16 years over 2016, at a rate of 3.6%.