Solo Oil Plc Tanzania Update (0804X)
August 26 2015 - 2:00AM
UK Regulatory
TIDMSOLO
RNS Number : 0804X
Solo Oil Plc
26 August 2015
FOR IMMEDIATE RELEASE, 7 am 26 August 2015
SOLO OIL PLC
("Solo" or the "Company")
Tanzania Update
Solo is pleased to provide an update on its assets in Tanzania
which are operated by Aminex plc ("Aminex") who have released an
interim statement today.
Neil Ritson, Solo's Chairman, commented:
"Considerable progress has been made recently in Tanzania and we
expect to have news of both commercial gas sales at Kiliwani North
and appraisal drilling in the Ntorya gas discovery shortly. The
imminent commencement of gas sales at Kiliwani North represents our
first revenue generating investment in Africa and is eagerly
awaited by the Company and its shareholders."
Kiliwani North
The Kiliwani North-1 gas well, which tested at 40 mmscfd, has
been completed and is now ready to produce. Initial gas production
will enable the pipeline operator to pressure-test the short spur
line between the wellhead and the new gas plant with gas sales
expected in third quarter 2015. Following an engineering review by
the operator, it is anticipated that a sustained production rate of
up to 30 mmscfd can be obtained, which is higher than the
previously planned 20 mmscfd and this will optimise the economics
and the life of the reservoir.
A Gas Sales Agreement ("GSA") is near completion, but the
operator awaits the finalisation of payment protection clauses and
guarantees prior to final signature. First commercial gas from
Kiliwani North will be delivered into a 36-inch regional pipeline
system, the construction and pressure testing of which is now
complete. The pipeline operator has constructed a sales pipeline
from Kiliwani North to the nearby processing plant at its own cost
with the operator responsible for supplying and installing a gas
metering unit. The Company will sell its production at the
wellhead, greatly simplifying commercial and management issues and
allowing for low operating and production costs. Production into
this new pipeline system has now commenced from other fields in the
south of the country. Gas from Kiliwani North will result in Solo's
first commercial production in Africa.
Solo holds an option to increase its interest in the Kiliwani
North Development Licence by 6.5% to a total of 13% once the GSA is
signed for a further payment of US$3.5 million to Aminex.
Participants in the Kiliwani North Development Licence are
currently: Ndovu Resources Ltd (Aminex) 58.5% (operator), RAK Gas
LLC 25%, Solo Oil plc 6.5% and Bounty Oil & Gas NL 10%.
Ruvuma PSA
The Ruvuma PSA located largely onshore in southern Tanzania
provides Solo with a combination of exploration and appraisal
activity.
In 2012 the Ntorya-1 discovery well in the Ruvuma PSA tested 20
mmscfd together with 139 barrels of associated condensate. In May
2014 the operator completed a 2D seismic programme to appraise the
Ntorya-1 discovery and to generate drilling targets.
Interpretation, mapping, and resource estimates have been updated
and new drill locations have now been identified based on the
results of the new and reprocessed seismic data. An updated
resource report by LR Senergy, completed in May 2015, has assigned
best estimate contingent resources of 70 bcf to the Ntorya-1 gas
discovery. The "up-dip" part of Ntorya, in addition to the gas
discovery, has been ascribed a further 945 Pmean bcf gas in-place
for a total of 1.1 tcf Pmean gas in-place for the greater Ntorya
gas field.
Several well locations have been identified from the new seismic
mapping, including the Ntorya-2 and Ntorya-3 appraisal wells as
well as Likonde-2 and Namisange-1 exploration wells. Aminex has
contracted North Sea Well Engineering Ltd to manage the Ntorya-2
and Ntorya-3 well planning, which is currently ongoing. The
proposed Ntorya-2 well, located just west and up-dip of Ntorya-1,
is expected to be spudded by first quarter 2016. Both the Ntorya-2
and Ntorya-3 wells are expected to test additional exploration
targets in addition to appraising the gas discovery.
The key to unlocking the commercial potential for these
opportunities in Ruvuma PSA is the new 36-inch common-user gas
pipeline which runs from the south of Tanzania to Dar es Salaam.
The pipeline and all associated facilities are likely to become
operational during third quarter 2015 and will provide a means of
marketing any further gas discoveries at Ruvuma through a gas sales
agreement with the Tanzanian authorities.
Participants in the Ruvuma PSA are: Ndovu Resources Ltd (Aminex)
75% (operator) and Solo Oil plc 25%.
Qualified Person's Statement:
The information contained in this announcement has been reviewed
and approved by Neil Ritson, Chairman and Director for Solo Oil Plc
who has over 38 years of relevant experience in the energy sector.
Mr. Ritson is a member of the Society of Petroleum Engineers, an
Active Member of the American Association of Petroleum Geologists
and is a Fellow of the Geological Society of London.
For further information:
Solo Oil plc
Neil Ritson
Fergus Jenkins +44 (0) 20 3794 9230
Beaumont Cornish Limited
Nominated Adviser and
Joint Broker
Roland Cornish +44 (0) 20 7628 3396
Shore Capital
Joint Broker
Pascal Keane
Jerry Keen (Corporate
Broker)
Bell Pottinger
Public Relations
Henry Lerwill
Cassiopeia Services
LLP +44 (0) 20 7408 4090
Investor Relations +44 (0) 20 3772 2500
Stefania Barbaglio +44 (0) 79 4969 0338
Glossary:
2D two-dimensional
------------------------------- -------------------------------------------------------------------------------------
bcf billion cubic feet
------------------------------- -------------------------------------------------------------------------------------
best estimate or Pmean an estimate representing the best technical assessment of likely projected volumes.
Often
associated with a central (2C), P(50) or Pmean value
------------------------------- -------------------------------------------------------------------------------------
contingent resources those quantities of petroleum estimated, as of a given date, to be potentially
recoverable
from known accumulations, but the applied project(s) are not yet considered mature
enough
for commercial development due to one or more contingencies
------------------------------- -------------------------------------------------------------------------------------
discovery a discovery is a petroleum accumulation for which one or several exploratory wells
have established
through testing, sampling and/or logging the existence of a significant quantity of
potentially
moveable hydrocarbons
------------------------------- -------------------------------------------------------------------------------------
gas initially in place or GIIP the quantity of gas that is estimated to exist originally in naturally occurring
accumulations
before any extraction or production
------------------------------- -------------------------------------------------------------------------------------
GSA gas sales agreement
------------------------------- -------------------------------------------------------------------------------------
mmscfd million standard cubic feet of gas per day
------------------------------- -------------------------------------------------------------------------------------
PSA petroleum sharing agreement
------------------------------- -------------------------------------------------------------------------------------
recovery or recoverable the quantity or portion of petroleum, here gas, initially-in-place that can be
extracted by
a well or wells to the surface
------------------------------- -------------------------------------------------------------------------------------
reserves reserves are defined by the SPE as those quantities of petroleum, here oil and gas,
which
are anticipated to be commercially recovered from known accumulations from a given
date forward
------------------------------- -------------------------------------------------------------------------------------
tcf trillion cubic feet
------------------------------- -------------------------------------------------------------------------------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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