Pavilion Energy has entered into an agreement to purchase 20% interest in Tanzania Blocks 1, 3 and 4 from Ophir Energy plc for a consideration of US$1.288 billion.

This is Pavilion Energy's first major investment to build a diversified LNG supply portfolio to meet Asian demand for clean energy.

"This investment in Tanzania Blocks 1, 3 and 4 is a key milestone for Pavilion Energy to build up our LNG portfolio. It supports our plan to secure long-term energy supply at competitive prices to meet the need for clean energy in Asia. It is also an important milestone for us as we work to develop an Asian LNG hub," said Group Chief Executive Officer of Pavilion Energy, Mr Seah Moon Ming.

Recent major gas discoveries off the shores of Tanzania are set to position the country as a key LNG exporter. Currently owned 60:40 by BG Group plc and Ophir Energy, the Tanzania Blocks 1, 3 and 4 are estimated to hold about 15 tcf of gas in moderate water depths. BG Group is the designated operator of this project. The first gas delivery is expected to begin in 2020.

"The natural gas developments in Tanzania hold tremendous potential – not just for Pavilion Energy but for Singapore and Asia. Pavilion Energy looks forward to the partnership with BG Group and Ophir Energy in realising the LNG project. The LNG from the Tanzanian project will provide another source of supply to the Asian markets," said Tan Sri Mohd Hassan Marican, Chairman of Pavilion Energy.

The investment is subject to regulatory, governmental and other required third party approvals, as well as approval by Ophir's shareholders by way of a general meeting of shareholders. The transaction is expected to complete in the first quarter of 2014.