“We are exploring offshore Kenya, and apparently it has the same kind of prospects as offshore Tanzania and Mozambique,” Christophe de Margerie told Dow Jones Newswires in an interview. “There might be oil too, we are not just looking for gas. We have acquired the seismic results, but until you drill, you don’t know.”

Italy’s Eni SpA (E) and Anadarko Petroleum Corp. (APC) have both announced major gas discoveries further south, offshore Mozambique, and are considering large-scale investments to export the gas by tanker in the form of liquefied natural gas.

Last month Exxon Mobil Corp. (XOM) and Norway’s Statoil ASA (STO) also said a recent discovery off the coast of Tanzania contained large quantities of natural gas, further cementing the idea that East Africa could become a big exporter of LNG.

“Maybe we have been late for Mozambique. But there are benefits for being onshore,” de Margerie said. “it is far cheaper. Those new potential discoveries, they are very deep offshore so the cost of development will be rather high.”

Onshore in Africa “we have been acquiring a lot of blocks in Kenya, have acquired part of the shares of Tullow Oil PLC (TLW.LN) in Uganda and have acquired blocks in Congo on the other side of Lake Albert, and we will be able to start exploring sooner or later in South Sudan.”

Offshore West Africa, Total will drill by end-2012 for the first time in an Ivory Coast block acquired two years ago, he noted.

Total has said it plans to grow its oil and gas output by 3% this year and 2.5% annually through 2014, assuming crude price stay around $100 a barrel.

The executive noted that Total is in talks to invest in Iraqi Kurdistan, and that he sees no problem in doing so as the autonomous region is part of Iraq. “Kurdistan is Iraq, and Baghdad is Iraq. It is up to them to decide what they do to develop their reserves.”

Exxon Mobil recently signed a deal to enter the region, rebuffing opposition from Iraq’s central government, which has said Kurdish deals without its approval are illegal.

De Margerie said Total hasn’t yet decided whether to enter Iraq’s planned fourth oil round.

Details of the exploration round aren’t yet certain, he said, adding that it seems that if a company discovered oil, “You might not get permission to develop your discoveries until after a period of time, to be determined by the government.”

“We are not saying we are not interested, but if they are saying you can explore but it is not sure when you can develop, usually this is not the sort of deal we like.”

-By Simon Hall, Dow Jones Newswires

DW Millennium Flow Test: Utilizing the Deepwater Millennium drillship, Anadarko successfully tests the natural gas flow rates at the Barquentine-2 well in the Rovuma Basin offshore Mozambique. Photo: Anadarko

THE WOODLANDS, Texas (Dow Jones)–Anadarko Petroleum Corp. (APC) expects natural gas prices to rebound significantly from their current depressed status after 2014, Chief Executive Jim Hackett said Tuesday.

The Texas-based oil producer is “cautiously optimistic about natural gas in the long term,” Hackett told investors and analysts at the company’s annual meeting. “We feel beyond 2014 you get into very, very interesting territory.”

Anadarko sees natural gas trading between $4 and $6 per million British thermal units, up from their decade-low levels below $2.40 currently, according to a slide shown in the company’s presentation. In 2016, gas should be trading between $5 and $7 per Mmbtu. Hackett acknowledged that Anadarko is “a bit more constructive,” or optimistic about natural gas prices, than the market is.

The market for crude oil should remain strong due to the difficulty of providing new supply to meet demand, coupled with rising geopolitical tensions, Hackett said. The market for natural gas liquids, driven by the recent addition of petrochemical infrastructure in the U.S., “should stay very strong,” Hackett added.

–By Angel Gonzalez, Dow Jones Newswires

The drillship Ocean Rig Poseidon and support vessels at the Zafarani location. (Photo: Statoil/Heine Melkevik)

Statoil and ExxonMobil announced today that the recent discovery of natural gas off the coast of Tanzania has proven to be a rather significant find, further solidfying East Africa’s prospect of becoming an exporter of liquefied natural gas to Asian markets.

Statoil and ExxonMobil first announced on February 17 that they had encountered indications of natural gas in the Zafarani exploration well in the Block 2 license offshore Tanzania.  Now, the companies are saying the logging result show that it is a “high impact discovery” with up to 5 trillion cubic feet of gas.  Statoil added that the well has encountered 120 meters of excellent quality reservoir with high porosity and high permeability.

“This discovery is the first Statoil operated discovery in East Africa and an important event for the future development of the Tanzanian gas industry,” commented Tim Dodson, executive vice president for Exploration in Statoil.

“This discovery could potentially be a catalyst for large scale natural gas developments in Tanzania,” says Yona Killaghane, Managing Director of Tanzania Petroleum Development Corporation (TPDC).

Earlier this week the partnership signed an addendum to the production sharing agreement for Block 2 which stipulates the commercial terms in case of a development of natural gas resources in the block with the Tanzanian authorities.

Statoil operates the licence on Block 2 on behalf of TPDC and has a 65% working interest with ExxonMobil Exploration and Production Tanzania Ltd. holding the remaining 35%.

Zafarani is the first exploration well that has been drilled in the license which covers an area of approximately 5,500 square kilometers. The water depth at the well location is 2,582 meters and the well itself will be drilled to reach an expected total depth of around 5,100 meters.

The drillship, Ocean Rig Poseidon, will after completing the drilling activities at Zafarani move to drill a second well in Block 2 on the Lavani prospect.

Italy’s Eni SpA and Anadarko Petroleum Corp. of the U.S. have also made large discoveries in East Africa offshore Mozambique. Another discovery offshore Tanzania was made last year by BG Group.