(Alliance News) - Aminex PLC on Tuesday said it has heard positive noises from Tanzania over projects held in the country.
Aminex back in July 2018 signed a farm-out agreement for the Ntorya gas project with Zubari Corp LLC. Ntorya is covered by the Ruvuma production sharing contract.
In exchange for 50% of the Ruvuma contract, ARA Petroleum Ltd, who Zubair assigned its interest in the farm-out to, will become operator.
Confirmation of the farm-out from Tanzania has still not yet occurred, but Aminex on Tuesday said there are "positive indications" coming from the country.
"There are positive signs from various media reports that indicate the government is now settling some long-term outstanding disputes with the international business community," said Aminex.
"The government utility company Tanzania Electric Supply Co Ltd is reportedly 'keen to end the power shortage' and other gas producing companies are preparing to increase their activity to meet the growing power/gas demand."
London-based Aminex and ARA Petroleum, once the farm-out is completed, are to seek permission from the government to move contingent elements of the 2020 work programme at Ntorya into the firm budget, Aminex said Tuesday.
ARA Petroleum, based in Oman, will drill the Chikumbi-1 well once permission is received, and Aminex is currently in the process of getting approvals to secure services needed to drill the well. ARA Petroleum has now set up an office in the Tanzanian capital of Dar-es-Salaam, Aminex added.
The partners also want to begin remediation work on the Kiliwani-North-1 well.
"While we continue to engage in constructive dialogue, Aminex and ARA Petroleum are working diligently to progress workflows such that when the approvals are given, we can quickly move into an operational phase and deliver first gas from Ntorya and begin remediation work on Kiliwani," said Aminex Chief Executive Tom Mackay.
"As of yet, no formal update has been received from the government of Tanzania in regards to our licences, however we have had positive indications in-country the government is approaching a place where it can update the international oil companies."
"We thank shareholders for their continued confidence in the project and patience during this time of internal government reform. We look forward to updating the market as and when progress is made," Mackay added.
Aminex shares were 4.6% higher on Tuesday afternoon in London at 0.94 pence each.
Solo Oil PLC, which holds 25% of the Ruvuma contracted, noted the Aminex agreement.
Chief Executive Tom Reynolds said: "While this is no affirmative feedback from the government of Tanzania, we are encouraged to see some positive developments as well as some progress between Aminex and ARA Petroleum. As announced towards the end of last year, our Tanzanian strategy is focused on high quality assets and stable cash flow, and we expect these discussions will further increase the likelihood of developing our assets to production.
"We look forward to updating shareholders as we move to realise the core value of our Tanzanian assets alongside our partners."
Solo's shares are currently suspended from trading in London. In October, it agreed the EUR32 million purchase of natural gas fields in the Dutch part of the North Sea. The deal is considered a reverse takeover under AIM rules, hence the share suspension.
By George Collard; georgecollard@alliancenews.com
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