Aminex PLC MILESTONE GAS SALES AGREEMENT SECURED (6603L)
January 13 2016 - 2:00AM
UK Regulatory
TIDMAEX
RNS Number : 6603L
Aminex PLC
13 January 2016
Aminex plc
("Aminex" or "the Company")
MILESTONE GAS SALES AGREEMENT SECURED
Aminex set to start first production in Africa
Aminex is pleased to report today that it has executed a
fully-termed Gas Sales Agreement ("GSA") with the Tanzania
Petroleum Development Corporation ("TPDC") for its Kiliwani North
gas field, which moves the Company into its much anticipated
production phase.
HIGHLIGHTS:
-- Milestone agreement moves the Company into producing phase;
-- Take-or-pay depletion contract with gas revenues payable in US Dollars;
-- Initial gas price of US$3.00 per mmbtu (approximately US$3.07 per mcf);
-- Effective date of GSA 31 December 2015;
-- Annual indexation of gas price from 1 January 2016; and
-- Agreed payment security mechanism
Participants in the Kiliwani North Development Licence are:
Ndovu Resources Ltd (Aminex) 55.575% (operator), RAK Gas LLC
23.75%, Bounty Oil & Gas NL 9.5%, Solo Oil plc 6.175% and TPDC
5%.
The Kiliwani North GSA allows for the expected depletion of
production from the field over time. In each contract year TPDC
will be required to purchase, take delivery of or pay for a
pre-determined volume of gas. In the event that TPDC elects not to
take delivery of the pre-determined volume, it will pay for the
equivalent of 85% of the agreed commercial rate of gas to be
supplied, adjusted each year in accordance with the terms of the
GSA. Gas from Kiliwani North will be supplied to the recently
completed Songo Songo gas processing plant.
Final well preparations, which are currently ongoing, are being
completed prior to testing and commissioning of the new plant.
During this phase production rates will be varied to optimise well
life and establish commercial rates. During the testing and
commissioning phase, the TPDC will be invoiced for gas produced at
the end of each month and will be required to pay on invoice.
The start of commercial operations will be mutually agreed
between the TPDC and the Company after testing and commissioning
has been completed. Each month, the TPDC will be required to pay
one month's revenues in advance, secured with a letter of credit
issued by the Tanzania Investment Bank. Monthly revenues will be
calculated based on actual production, and adjustments will be made
at the end of each month for any discrepancy between estimated and
actual throughput.
Gas will be sold at US$3.00 per mmbtu (approximately US$3.07 per
mcf) and the price will be adjusted annually by applying an agreed
United States Consumer Price Index. The gas price is not linked to
any commodity price so is unaffected by current commodity market
conditions. Gas revenues will be invoiced and payable in United
States Dollars and the gas delivery point will be at the outlet
flange of the Kiliwani North wellhead. By selling the gas at the
wellhead, the joint venture partners will not be responsible for
pipeline transportation and processing fees.
Shareholders are reminded that Solo Oil plc retains an option to
purchase a further 6.5% stake in the KNDL (before TPDC back-in) for
a period of 30 days following signing of the GSA, according to the
terms of an agreement previously advised to shareholders. As
previously announced, Bowleven and Aminex have signed a Heads of
Terms agreement for future cooperation in Tanzania, including
Bowleven's participation in Kiliwani North, which remains subject
to shareholder and all regulatory approvals.
Aminex Chief Executive, Jay Bhattacherjee, commented: "Aminex
has operated in Tanzania for over 13 years, always working closely
with the Tanzanian authorities, and the Kiliwani North Gas Sales
Agreement represents a major milestone as the Company's first
commercial production in Tanzania.
"Achieving this agreement has been a long time coming but the
final version is comprehensive and will allow production to
commence with clarity and security. We are grateful to shareholders
for their support and patience. With a mix of production from
Kiliwani North and upcoming appraisal and development drilling in
the highly prospective Ruvuma basin, we consider Aminex to be well
placed for further growth."
- Ends -
For further information:
Aminex PLC +44 20 7291 3100
Jay Bhattacherjee, Chief
Executive Officer
Max Williams, Chief Financial
Officer
www.aminex-plc.com
Corporate Brokers
Shore Capital Stockbrokers-Jerry
Keen +44 20 7408 4090
Davy Corporate Finance-Brian
Garrahy +35 3 1679 7788
GMP Securities Europe
LLP-Rob Collins +44 20 7647 2816
Yellow Jersey PR (Financial
PR) +44 7584 085 670
Dominic Barretto
Aidan Stanley
This information is provided by RNS
The company news service from the London Stock Exchange
END
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