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ARA own 30% of AEX. They are not going to give up the golden goose.
Another reason for putting forward an ultimatum to the Tanz Gov is that they need to complete the work listed below before the end of April 2021, else risk loosing any further license extensions.
Acquire 200 square kilometres (surface coverage) of 3D seismic (min. expenditure of US$7 million)
· Drill the Chikumbi-1 exploration well (min. expenditure of US$15 million)
· Complete the negotiation of the Gas Terms for the Ruvuma PSA with the Tanzania Petroleum Development Corporation
· Using the data gathered from Chikumbi-1 and the seismic acquisition, prepare and submit an application for a Development Licence for the Ntorya Location area.
"That the Zubairs will walk away if the Gov say, let us get our election out the way and then we will see to your Farm-out? Will the 15th be the final curtain or simply the encore?"
in short yes, and if it could have an impact on the support ofr the current corrupt shambles of a government, then that's a strong yes. I think they've had enough.
Dunder, please help with my understanding but I thought that the operator pays for operations and claims back the money from the partners and also gets paid for gas and distributes that to the partners. Therefore any disputes would need to be dealt with between the operator and the partners and the government doesn't really need to worry. If a partner fails to pay the operator or breaks the contract in any way then the operator has the right to take action against the partner. APT will be making all of the planning decisions whilst keeping the JV's informed and maybe taking advice, but the final operational decisions will always be the operators and hence their responsibility. Is that not right?
Matherdj not that this is relevant but the govt. "may" be interested in who the JV partners are for a variety of reasons.
Also it is not the operator who makes up non jv payments it is all the partners in equitable proportions of ownership.
Not at all Buckler. The government isn't interested in the JV partners really. It's the operator who pays the bills and takes responsibility if a JV partner is unable to finance etc. It really makes no difference who they are.
CP; does it not seem odd that TZ would complete the FO when they know Solo is about to change hands? Unless they are proactively engaged in/with the transfer of ownership of Solo? In which case, as I say, I would expect AEX to be able to say that the reason for the ongoing delay is the prospective sale of Solo. Instead, from AEX, nada.
APT have had the right to terminate 8 times so far, every time a Long Stop date has approached. They haven't pulled the trigger before, so why not? 2trillion reasons?
SOLO RNS this week claims that they are waiting for the FO to complete here before they ca proceed with their transaction, sounds right to me.
Solo RNS Wed
"The Company has made significant progress on its Tanzanian asset sales process and extracting maximum value from the Ruvuma asset, which is key to delivering our broader strategy. The Company continues to await the completion of the Aminex / ARA Petroleum farmout ahead of the expected conclusion of its own process;"
They're too busy out on handshaking expeditions. Any recent photos on their web sites show few signs of social distancing or mask wearing at their functions.
https://twitter.com/Nishati2017/status/1310865713977085952/photo/4
https://twitter.com/TraceyIva/status/1311729744317210626/photo/1
Aminex would know by now if the government were not going to give approval. The government have not said they won't sign. A date has been requested by Aminex being the 15th October and are hopeful that the FO will be approved by this time. The issue with the government is the length of time they are taking to approve. They are rather slow which is normal, unfortunately. If there was no chance of the FO being approved, then the TRA would not have issued the tax certificate. If the government were conning Aminex and the Zubairs by stringing them along and dishing out certificates, then they really are not that intelligent and are be stupid. However I don't think they are that dumb. The basic and simple explanation is the documents are sitting in someone's in tray and they will get around to it, probably a bit quicker now there is a deadline.
Come on folks. What is the underlying problem here? AEX consistently said they are working with the TZ authorities 'closely' on this. Is the whole game here an attempt to strong arm someone out of the license? Then why grant extensions?
What 'thing' is it that the TZ government need in order to close this off? Is it anything to do with Solo trying to flog off their interest? Would it be that Solo need to close that off before TZ can sign off with a clear view of who the final JV partners are? They have a possible unknown additional party in the mix?
If that is the case, why TF aren't AEX telling people that? You would think they would know/have been told and should be communicating same to the market.
If not, what else is it?
Absolutely Cperkin, I think the following comment is telling:
"if such Government approval is not obtained by 15 October 2020, APT will have the right to terminate the Farm-Out Agreement."
APT having the right to terminate the Farm-Out does not necessary mean that they will.
AEX / APT clearly needed to do something different to try to force the govt into action after months of delays. Let's hope it works! APT clearly believe in the project, otherwise they wouldn't have sunk so much cash into AEX already and granted us millions in loans.
"the right to terminate"
Quite forceful words..
My thoughts exactly CP. They absolutely must realise the election could be a factor, so would they really bin this off when its this close? Providing Magufuli gets in again of course.
That the Zubairs will walk away if the Gov say, let us get our election out the way and then we will see to your Farm-out? Will the 15th be the final curtain or simply the encore?