Petroleum Africa
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Wednesday, February 4, 2015
The deal between Aminex plc and Solo Oil for the sale of a portion of Aminex’s stake in the Kiluwani North Development License (KDNL) is almost a done deal. The two entered into a binding agreement for Aminex to sell up to a 13% stake in the license for a total consideration of $7 million. Aminex and Solo have now signed the Asset Sale Agreement for the first 6.5% interest and the only conditions precedent remaining are the formal approval from Tanzanian authorities, which is expected shortly, and the formal signing of the Asset Assignment Agreement by all the partners.
In addition, both companies have agreed to amend the original terms of the agreement to allow Solo the option to purchase the additional 6.5% interest in the license to a period of 30 days after the GSA has been agreed on the same terms as the first 6.5% interest.
The KNDL contains the Kiliwani North 1 (KN1) well, which Aminex and Solo expect to produce at approximately 20 Mmcf/d when it comes on stream. Production starts up and subsequent revenues will represent a major milestone for the company in Tanzania.Independently verified resources at Kiliwani North are estimated to be 45 Bcf of gas in place.
Construction of the 2-km pipeline from the KN1 wellhead to the new Songo Songo processing plant,at zero cost to Aminex, is underway and expected to be completed shortly. The partnership has been notified by TPDC that pressure testing of the pipeline is expected to commence during Q1 2015.
Aminex said it is looking forward to the signing of the GSA, which is largely complete but is experiencing delays in closing due to the Tanzanian authorities’ approval process. The Board expects the GSA to be signed prior to any gas being delivered for pressure testing or commissioning and the company will continue to keep the market informed on developments accordingly.
Aminex and Solo are already partners in the Ruvuma PSC in Tanzania, with 75% and 25% interests respectively, where gas was discovered in 2012 at Ntorya-1. Ndovu is the operator of both the Ruvuma PSA and the KNDL.
Aminex CEO, Jay Bhattacherjee, commented: “As Aminex steps closer to strengthening its balance sheet and towards first gas in Tanzania, the Board is pleased with progress particularly given the backdrop of a wider and challenging Oil & Gas sector. While the GSA remains subject to final approval, the construction of the main pipeline is on schedule with pressure testing and commissioning expected to begin shortly. The Board reaffirms to all shareholders that it is doing everything within its power to progress the GSA and move towards first production in the first half of this year.”
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