Exploration firm Cove Energy has reported a new gas find off Mozambique, increasing the size of its discoveries in the east African nation by as much as 66 per cent.

The Golfinho exploration well, drilled by partner Anadarko Petroleum, found 7 trillion to 20 trillion cubic feet of recoverable gas. The discovery was separate to the existing Prosperidade find, which holds as much as 30 trillion cubic feet. In total, the Rovuma Area 1 block where Anadarko and Cove are exploring may hold more than five times the UK's existing gas reserves.

"The well results are indicative of the upside that the potential acquirers of Cove Energy have priced into their offers," FirstEnergy Capital wrote in an e-mailed report. "We anticipate further consolidation in the region as the size of the discoveries becomes even more attractive to super majors."

Shell, Europe's largest oil company, agreed to buy Cove last month, after raising its bid to £1.12 billion, or 220 pence a share, and matching a rival offer from Thailand's PTT Exploration and Production.

Cove has an 8.5 per cent interest in Rovuma Area 1. The fields will supply liquefied natural-gas projects that export to Asia.

"This new gas accumulation is independent and separate to the Prosperidade gas complex," said Cove's chief executive John Craven. The find "could be advantageously developed, given its close proximity to the shore".

PTT, which is still considering whether to raise its bid, declined to comment on the new discovery.

However, Dolmen Stockbrokers said although the announcement was "significant", there were some obstacles to a higher bid, and warned PTT would be subject to balance sheet limitations.

"Firstly, Royal Dutch Shell's existing bid at 220p has already received government approval with Cove's management also signing irrecovables accounting for approximately 5 per cnet of the outstanding shares. Moreover, Royal Dutch Shell's bid at 220p is net of tax at 12.8 per cent which means that the existing bid is closer to 255p reflecting the effective tax rate (which will be lower) Royal Dutch Shell will actually pay to secure the asset," Dolmen said.

"As a result, in our view a new bidder with technological expertise equivalent to Royal Dutch Shell would have to enter the bidding. PTTEP re-entering is also still a probability; however it will be constrained by balance sheet limitations, its technological ability and the likelihood that its tax structures are not as sophisticated as Royal Dutch Shell's."

Additional reporting: Bloomberg