RNS Number : 2562Z
Aminex PLC
17 July 2008
17 JULY 2008
AMINEX PLC
TANZANIA EXPLORATION UPDATE
Aminex PLC, the oil and gas company listed in London and Dublin ("Aminex" or the
"Company"), provides the following update on its
Tanzanian exploration activities.
During the second period of the Nyuni/East Songo-Songo Production Sharing Agreement
("Nyuni" or "Nyuni PSA") new seismic was acquired
and two wells were drilled back-to-back, the second of which, Kiliwani North-1 ("KN-1"),
encountered a 60 metre gross gas column in Lower
Cretaceous sands. A 20 metre interval was perforated and was later successfully
production-tested. As announced on 4 June, this well test
recorded a flow rate of 40 million cubic feet/day which, together with other data recorded and
subsequent lab analysis, satisfies Aminex
that the Kiliwani North ("KN") discovery will result in the development of a commercially
viable gas field.
The Nyuni PSA is sub-divided into three work periods, the second of which ended in May
2008. The Joint Venture has now applied to the
Government of Tanzania to carve out a separate appraisal area for the KN discovery comprising
the discovery block and adjoining blocks,
while the remainder of the Nyuni area will be explored during the third period under the PSA
terms. Commercialisation of KN through the KN-1
well will be fast-tracked as a separate project with the aim of achieving early production.This will be done in parallel with further
seismic and exploration drilling over the remaining exploration blocks.
The KN-1 well has now proved that the neighbouring Songo-Songo producing gas field is not
a "one-off" or "stand-alone" field and that
the surrounding prospects are also capable of producing commercial hydrocarbons. Specific
reserves for KN are virtually impossible to
establish at this stage because the KN structure extends to the north, beyond the range of
existing seismic coverage. A programme of field
appraisal and delineation will be conducted in parallel with the early commercialisation of
the KN-1 discovery.
KN should be treated as one of several adjoining gas accumulations in acreage held by
Aminex and partners which should provide the basis
for development of a significant new gas business in the region. In addition to KN, the Nyuni
JV is planning to explore and evaluate other
prospects in the region. An internal evaluation of all of the prospects identified results in
combined prospect sizes in excess of 1
trillion cubic feet of gas on a risked P50 basis. This figure results only from prospect
evaluation and should not be confused with a
reserves calculation. An independent review of these prospects will be carried out over the
next two months which may result in a larger or
smaller total. It is too early to provide a meaningful estimate of reserves for the KN
discovery at this time, given the absence of
structural delineation to the North.
The KN well, now completed and suspended for future production, is located on Songo-Songo
Island approximately three kilometres from the
Songo-Songo Gas Field's processing facilities operated by Songas, a division of CDC Globelec.From the Songas facilities a 12" subsea
pipeline makes a landfall on the Tanzanian coast and then connects to a 16" pipeline which
carries gas approximately 200 kilometres to
Tanzania's principal city, Dar es Salaam. This common-user pipeline has been transporting gas
from the Songo-Songo field since 2004 but is
also available to the Nyuni joint venture under the terms of the Nyuni PSA. KN is effectively
located next to an emerging gas-gathering hub
and to the only major gas pipeline in the entire region. To accommodate increasing gas
production, process facilities may need to be
expanded and ultimately pipeline capacity may need to be increased, either through adding
compression capability or through "twinning" the
existing pipeline. Studies are in hand to identify fast-track, temporary alternatives for
producing KN gas commercially on a shorter time scale than would be permitted by an upgrading
of the Songas
facilities, in order to generate early revenues and to build production history
Current gas production in Tanzania is used for power generation, where it replaces
expensive imported fuel oil, for firing an important
cement plant and increasingly for use by other industries in the Dar es Salaam area. It is
clear that industrial and other users will
respond positively to increasing supplies of gas, in a country which has traditionally been
starved of energy. The Government of Tanzania
has recently made it very clear that it attaches great importance to the development of a
domestic gas industry as rapidly as possible.
Partners in the Nyuni PSA are: Ndovu Resources Ltd. (Aminex) 40% (operator), RAK Gas
Commission (25%), Key Petroleum Ltd. (20%), East
African Exploration (10%) and Bounty Oil (5%).
In addition to the Nyuni PSA, Aminex has a 50% interest in the recently awarded
Songo-Songo West Production Sharing Agreement in
partnership with Key Petroleum Ltd. which acts as operator. Aminex therefore has interests in
acreage which virtually surrounds the
Songo-Songo producing gas field.
Elsewhere in Tanzania, good progress is being made in preparation for first drilling in
the 12,000 square kilometre Ruvuma Basin
Production Sharing Agreement where Aminex is in 50-50 partnership with Tullow Oil. The first
of two commitment wells is expected to be
spudded early in 2009.
For further information:
Brian Hall Aminex London 020 7291 3100
Archie Berens Pelham PR London 020 7743 6679
This information is provided by RNS
The company news service from the London Stock Exchange
END
DRLVQLFFVDBFBBB
|