Beach Energy Limited has been given a go-signal to explore the Great Rift Valley in Tanzania for oil after it successfully sealed a contract with the African nation's government.

Although the terms and conditions were not disclosed to the public, an official of the company said its subsidiary, Tanzania-based Beach Petroleum, has been granted a production sharing agreement (PSA) to explore for a 100 per cent interest in the Lake Tanganyika South concession.

Beach said that due to the specific requirements of operating in the remote area of Tanzania, the terms of the agreement proved favorable to the company than the standard terms required from the Tanzania Petroleum Development Corporation (TPDC).

The company also said the area was well known for oil and it would make similar yielding success just like in the rift system in Uganda.

“The signing of the Lake Tanganyika PSA is a major milestone for Beach,” the company's managing director Reg Nelson said.

“Beach is very grateful for the leadership, co-operation and professionalism displayed by TPDC in the negotiation of the PSA and looks forward to working with TPDC to explore this highly prospective acreage.”

Tanzania PSAs were organized according to three exploration phases with about 11 years in running.

According to company's website, Beach Energy is an established oil and gas exploration and production company situated in Adelaide, South Australia.