SOLO.L Share News (SOLO)

(ShareCast News) - Oil explorers Solo Oil and Aminex said the Kiliwani North-1 gas well in Tanzania will produce more gas than initially expected.The two groups said the well, which was tested with a flow rate of 40m standard cubic feet per day, was expected to deliver an initial production rate of approximately 20m standard cubic feet per day, but new estimates indicate it will have a sustained daily output of 30m standard cubic feet.Aminex, which owns a 58.5% stake in the project, and Solo, which has a 6.5% interest, added the well was "ready to produce" and the gas will be pumped into a newly-built pipeline.However, the companies still have to finalise the gas sales agreement before production can begin."A gas sales agreement is near completion, but the operator awaits the finalisation of payment protection clauses and guarantees prior to final signature," Aminex said in a statement on Wednesday.Meanwhile, the two groups are expecting to be drilled the Ntorya-2 well at the Ruvuma project in Tanzania, in which Aminex holds a 75% stake to Solo's 25%, in the first quarter of 2016."The signing of the Kiliwani North Gas Sales Agreement, expected in the near future, should also assist the acceleration of the Company's other activities, particularly appraisal drilling at Ntorya," said Aminex group chief executive Jay Bhattacherjee."The board believes that the steps we are taking will be significant for the growth of the Company and underline its strategy to focus on key assets in Tanzania, ever seeking new production and development opportunities."Solo can increase its stake in the Kiiwani project to 13% once the gas sales agreement has been signed and Aminex said it would use the $3.5m to reduce its debt.In a separate statement, the London-listed group reported a $606,000 pre-tax loss in the first half of 2015, compared with a $4m loss in the corresponding period in 2014.Aminex said the narrower loss was attributable to a $1.8m gain from farming-down interest in the Kiliwani project and to a drastic decline in expenses.As of 0935 BST on Wednesday, Aminex shares were up 3.67% to 2.05p, while Solo Oil shares were up 3.87% to 0.410p.