BG Group exits Tanzania Block 3 gas licence

(Adds Ophir comment, background)

LONDON, Oct 2 (Reuters) - British gas producer BG Group (LSE: BG.L - news) said on Thursday it had withdrawn from the development of a gas block offshore Tanzania after finding it was not worth exploring further there.

Its partner Ophir Energy (Other OTC: OPGYF - news) in Block 3 off the coast of the east African country said it had applied to the government to take over BG's 60 percent interest and operatorship of the licence, bringing its stake in the block to 80 percent.

Pavilion Energy, owned by Singapore investment company Temasek, holds the other 20 percent.

"We have applied to the government to relinquish (involvement). Our view of the resource does not support BG Group proceeding to the next phase of development," a spokesman for BG Group said.

Ophir would make no payment to BG as a result of taking over the stake.

The gas group, Britain's third-biggest energy company, is under pressure to rein in costs and reshape its asset portfolio after a series of production downgrades that led to the resignation of its chief executive earlier this year.

BG plans to open a liquefied natural gas (LNG) export terminal in Tanzania together with partners Ophir, Statoil and Exxon Mobil, which will be fed with gas from two other offshore blocks.

Ophir said it would take over operatorship of Block 3 this month, subject to government approval.

So far, only one well has been drilled on the block, the Papa-1 well, where gas was discovered in 2012. (Reporting by Karolin Schaps; Editing by Jason Neely and David Holmes)