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Exactly bullfrog, it’s nice and clear. Two primary sources:

1. Ntorya

2. Mozambique offshore Area 1 - as “a complementary supply”

As I just posted on Telegram, this development is mind boggling. This has in no way sunk in for me properly yet

It is worth expanding on the significance of the Mtwara LNG project uncovered yesterday and its explicit direct link to Ntorya as the primary source of supply.

To be clear, this is a different project to the LNG terminal at Lindi that will potentially be built by Shell and Equinor. Mtwara LNG Ltd is a planned strategic joint venture between:

1. Viability Gap Plc – Project structuring and infrastructure financing

2. N-Gas Tanzania Ltd – Upstream and midstream gas development

3. Tanzania Petroleum Development Corporation (TPDC) – National resource custodian and state partner

This is not just some private organisation outlining an unlikely to be achieved vision. TPDC is one of the JV partners (subject to completion of Environmental Impact Assessment). This is state endorsed. If you look at the website, it is clearly a detailed and carefully considered plan.

On their website, they state that Ntorya is one of two primary supply sources (the other being an offshore block just over the border in Mozambique) – Ntorya being listed first, and the Mozambique asset being described as providing "a complementary supply".

The project is enormous. A $4.5bn investment (USD). It will include LNG production from natural gas. The plan is to create a ‘Regional Clean Energy Corridor’ with a modular LNG and CNG hub network to reach underserved areas across East and Southern Africa. Planned Distribution Hubs:

• Tanzania: Dodoma, Arusha, Mwanza, Mbeya, Tanga, and Zanzibar

• Zambia: Lusaka and Kasompe

• DRC: Tenke–Fungurume and Mutaka

• Mozambique: Tete and Chimoio

• Kenya: Nairobi and Mombasa

They are also targeting export as far and wide as Southern Africa (e.g. South Africa, Botswana, Zimbabwe) and Asia (e.g. Japan and India).

The project includes using pipelines, virtual pipelines, road and rail integration. Also, a Marine Export Jetty.

In terms of production, the expectation is to start at 3 MTPA (400mmscf/d) and scale to a potential 9 MTPA (1,200mmscf/d).

Let that lot sink in! Ntorya is cited as the primary source of supply for a new state backed LNG project that will initially require 400mmscf/d, ramping up to a potential 1,200mmscf/d!!! With plans to distribute our gas domestically and across East Africa, Southern Africa and Asia!

To say this is MASSIVE would be an understatement.

https://mtwaralng.com/

For a long time now, trolls have been referencing Orca and trying to use their situation to sow doubt about Aminex’s future profitability.

It is well recognised that the relationship between Orca and the Tanzanian authorities has been challenging for many years – I understand they are perceived as greedy and not working in partnership. Aside from this, the PSA signed with PAET (wholly owned subsidiary of Orca) is unusually complex, disadvantageous and it is in no way comparable to Aminex.

I have put an illustration with more detail on the Telegram chat.

Whilst PAET’s PSA hinders profitability despite considerable rates of production, in ‘normal’ operating years, they have been profitable. Aminex is well placed to be considerably more profitable. Key points below:

Approx. 30% of PAET’s gas given away for free in recent years – due to ‘Protected Gas’ concept. THIS IS UNIQUE. NO PSA SIGNED SINCE RESEMBLES THIS

Costs – even TPDC’s costs and those related to the gas given away for free - have to be clawed back from the remaining gas revenues - making it harder still to turn a profit

Remaining profit is then shared with TPDC – 45% to TPDC for recent years production levels

Despite this, Orca still made decent profit in ‘normal’ years - 2024 was unusual due to issues including Songas shutdown. In 2023, they recorded a $34.9m depletion charge, partly related to 3D costs (no free carry for them!). However, net income attributable to shareholders was $16.37m in 2021, increasing to $27.73m in 2022

Imagine how profitable Aminex will be with –

• A simple, more equitable PSA - with gas sold at wellhead (one price for gas for power. Higer prices for gas for industry). No 30% given away for free!

• Other significant factors including - no debts dragging on profits, the free carry continuing to protect us from upcoming capital expenditure (with any unspent free carry being paid to us out of ARA’s share of profits), $115.7m unspent tax loses to be offset against future taxable profits, the $103.4m intercompany loan to Ndovu to be re-paid from future revenues from Tanzania (paid by ARA to Ndovu net of costs and Tanzanian taxes. Those monies being paid to Aminex by Ndovu as repayment of the loan capital, will attract no further tax by Aminex)

Aminex is in a very different situation to Orca and very well placed for many extremely profitable years ahead!

There was another interesting clarification / refining of the narrative at the AGM...

Previously they have talked about Ntorya being the largest onshore gas field in East Africa. I believe East Africa includes 18 countries.

At the AGM they went further and clarified that it is the largest onshore gas discovery in Sub Saharan Africa - which I believe is an even more substantial 46 countries (of the 54 countries in Africa as a whole).

The story builds

A small clarification on what was said regarding production rates from wells in the reservoir. There was a question regarding what production rate we can expect from CH1. Looking at my notes, Tom Mackay replied to say:

In the sweeter spots of the reservoir we should be able to get 50mmscf/d from individual wells.

Charles Santos chimed in to say:

...and there is an expectation with Chikumbi-1 that it will be definitely higher than 20mmscf/d.

So, the expectation is that there will be a number of wells that may produce around 50mmscf/d, not just CH1. I will not be surprised if CH1 produces at a slightly higher rate than 50mmscf/d.

Plenty of upside to the modelling that has been done.

Great update P26

In relation to the 3rd phase, Tom also said the aim is to maintain the 280mmscf/d plateau into the future. Using in field compression, to bring down the operating pressure of the pipeline(s). This increases production capacity.

Interesting

Something else that was mentioned at the AGM and that I don't think has been covered here is that when Tom was taking us through the phased development slides, he mentioned that the second phase may involve an additional pipeline to Madimba.

He then said it: "will need an additional pipeline through to the processing facility and put an extension on the processing facility, but with such a large in place volume, 140mmscf/d will go nowhere near to adequately draining the field. Increasing to 280mmscf/d would actually bring the reserves into production within the life of the production licence”

The trolls obviously sold a load before and during the AGM, expecting bad news… now desperately trying to spin negativity to they can buy back as low as they can.

😂😂😂

At the AGM yesterday, the Board re-iterated the position they gave at last year's meeting - that TPDC will have a maximum 15% stake. They also said that they hope they do take this up as it will be very beneficial to have them involved as partners in this way.

Oh, and don't be fooled....

Yesterday, there was selling up to and during the AGM. No doubt people assuming that the Board would disappoint on timelines for CH1.

At 3:40pm Samb posted that the plan was being re-sequenced and will now take place BEFORE the pipeline is commissioned.

From that point onwards, it was a sea of blue. Take a look for yourself on the share trades tab above.

The last trade reported for 1.66p was from 3:46pm. Making it look like a sell at the end of the trading day - which was not the case.

Hopefully we will see more buying action as the good news filters out and the market catches up with the fact that CH1 will be drilled sooner than many (including myself) had previously assumed.

I've been going to the AGMs for many years and yesterday was as positive as I can remember.

I’m still mentally adjusting to the change in gear.

Not the delays of the past. The message was effectively “change of plan, we’re re-sequencing and bringing the CH1 drill forward BEFORE the pipeline is commissioned”

That just wouldn’t have happened in past AGMs. It was really excellent.

P.S. it is amusing to see that the usual candidates are trying to spin some negativity off the back of a very positive AGM, that they weren't even at! 😂

So, within the next 4 weeks we should get…

1. More news at the AGM next Thurs. should be some good nuggets

2. Satellite image confirmation and/or news of boots on the ground for pipeline construction

3. CH1 tenders issued for expedited delivery

These bits I’ve put in CAPS are also very encouraging…

PURA requested this strategy to expedite the tendering process. Once APT receives approval from PURA, it will IMMEDIATELY issue the rig tender and tenders for other necessary services, expecting to do so NO LATER THAN MID-AUGUST 2025.

There is a definite chance in tone and vocabulary.

Really pleasing to see that PURA asked for ARA to give a strategy to get the rig faster!

The bit I’ve put in CAPS here is interesting…

Earlier this week, APT presented a tender strategy to the Petroleum Upstream Regulatory Authority (PURA) for contracting a rig to drill the Chikumbi-1 well and perform a workover on the Ntorya-1 well, along with all related services. PURA REQUESTED THIS STRATEGY TO EXPEDITE THE TENDERING PROCESS.

So. the Tanzanians are now saying “show us how you can get the drill done more quickly “.

Encouraging

Confirms production in 12 months.

Rig tender to be issued with the next 4 weeks.

Does look as though we may be decoupling from rig share idea.

So makes me more optimistic of an earlier drill date.

Am going to be busy today, but would be most grateful if anyone can check out the latest satellite images.

With the pipeline contract signed, and even TPDC saying that all the preliminaries are done and the project is ready to start, there is bound to be activity on the ground very soon.

Construction completed within 8 months TPDC said. Chop chop!

Aminex AGM is 2 weeks today. 11 working days including today. Oh, to have eyes on the presentation they will be drafting 🤩