LONDON (Alliance News) - Solo Oil PLC and Aminex PLC on Monday said the Ntorya-2 appraisal well on the Kiliwani North development in Tanzania will be drilled in "mid-December", and it said initial results are due "early next year".
Solo Oil is carried on the cost of the well, given the go ahead after Solo Oil finished its independent inspection of the Caroil-2 rig that will used to drill the well. Solo Oil has a 25% interest in the well, while Aminex holds the other 75%.
Ntorya-2 will be located 1,500 metres south-west of the Ntorya-1 discovery well that achieved a flow rate of 20.0 million cubic feet of gas per day , along with 139 barrels of associated condensate, under testing conditions.
Solo Oil said it has also completed all the civil work related to the next well to be drilled, Ntorya-3, located 5.0 kilometres from Ntorya-1, but said the plan may change depending on the results from Ntorya-2.
Solo Oil said revenue from gas sales from Kiliwani North to state-owned Tanzania Petroleum Development Corp has now been established. The gas is being sold at a price of USD3 per million British thermal units. Gas is sold at the well head and the partners on the field are not liable for any transmission or transportation costs from the well.
Solo Oil holds a 7.125% working interest in the Kiliwani North field and the gas sales.
"News from Aminex, the operator of both the Ruvuma production-sharing agreement and the Kiliwani North development licence, confirms that both operations remain on schedule. Solo is especially excited that the spud of the Ntorya appraisal well is now imminent since this well has significant upside potential for Solo's asset holdings in Tanzania. The receipt of regular gas payments from TPDC is also encouraging and will support the investments being made in Tanzania," said Solo Chairman Neil Ritson.
Aminex said the agreed gas price with TDPC is not linked to global commodity prices and so is unaffected by changing market conditions. Aminex said it using its net proceeds from gas sales in order to pay down its corporate debt.
Aminex shares were down 1.0% on Monday at 2.05 pence per share, while Solo shares were up 11% to 0.289p per share.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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