Member Info for Ufufuo

Agreed Tanzania. As is widely reported, President Magafuli (who came to power in late 2015) championed a nationalistic regime; particularly in relation to gas and other natural resources. It became impossible to progress any projects. PSAs were being renegotiated in favour of the government. Companies were being hit with ridiculous tax bills. When Kiliwani North could no longer produce, Aminex's options narrowed severely.

No doubt some mistakes were made by Aminex in this period. Easy to criticise with with the benefit of hindsight. Also with the benefit of hindsight it is clear to see that, because of the behaviours and policies of the Magafuli government, the farmout to ARA was the only deal that could be done and saved our bacon.

Aminex could have been taken out on the cheap or left to fail in recent years but the Board has avoided that. They have reduced costs dramatically. They are taking share options in lieu of salary. ARA has offered loans to support us when we've needed.

Personally, I am grateful for the honourable behaviour of ARA and the for the efforts of the Board (particularly in recent years) to make it so that Aminex still exists and shareholders can look forward to significant value creation as we approach CH1 and production from Ntorya.

Aminex is on course and fully carried to receive significant revenues by the end of 2024. No stock market investment is risk free but the risk Vs reward equation here is an absolute gift. CH1 is a company making drill. As I have seen with other companies with similarly significant drills, I expect this will 10 bag from here. The likely volumes of gas are huge. The potential for oil in the deeper target in particular will create one hell of a buzz.

Best of luck to all the LTH and genuine investors

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Agree with you haggis. Certainly dirt cheap right now. With the new President of Tanzania being so much more investor friendly, new Energy Minister, ARA with all their wealth and experience leading operations in Ruvuma, increasing demand for and cost of gas…so much has changed in the last year or so. I’m very confident about the year ahead for the reasons you outline

Announcement today: Astra Energy Inc today announces the Company has engaged the government of Tanzania in discussions to construct a significantly sized, combined cycle power plant using natural gas as feedstock.

Reaching this milestone is an indication of efforts of Tanzania’s new leadership to create a conducive and supportive environment for foreign direct investment in infrastructure development intended to stimulate the country’s aggressive manufacturing sector. Tanzania requires a significant amount of electricity to power its ambitious economic growth and transformation strategy. The country is blessed with an estimated 57 trillion cubic feet of natural gas reserves.

https://www.globenewswire.com/news-release/2022/03/08/2398935/0/en/Astra-Energy-Inc-Expands-Its-Presence-in-the-African-Market-with-Entry-into-Tanzania-s-Energy-Sector.html

A really excellent find! Thanks for sharing.

“The President of Tanzania underlines efforts the country is making to secure new energy markets - and says that tensions provoked by Russian aggression in Ukraine is helping to generate European interest in Tanzania's gas”.

https://www.theafricareport.com/178985/tanzania-president-samia-says-russia-ukraine-tension-an-opportunity-for-gas-sales/

Gas prices are up 40% today!! Operations in sub Saharan Africa should not be affected. The president of Tanzania herself said she saw the situation as an opportunity for Tanzanian gas market.

Hopefully people will wake up soon and realise that, sad it is, the current situation in Russia/Ukraine has no negative impact for Aminex. Oil and gas prices rising. Countries around the world will be looking for sources of gas other than Russia. Operations in Tanzania are not going to be affected.

Yes, I agree about KN1 not being the big prize for a JV there. As for whether Aminex may try to get some production back up and running at KN1 themselves, I think it’s a possibility as I believe it would be pretty low cost. However, I agree that Aminex may now lack the operational capability and may not want to risk spending money on this when the main goal is probably to retain enough cash to get us through to first gas from Ntorya. Time will tell!

Existing GSA to 2036, potential new targets identified and proximity of Songo Songo plant with spare capacity to tie into would all be attractive to potential JV partner (not talking about KN1 remediation specifically here).

My guess is that they are discussing with TZ authorities and potential suitors and it is taking time partly due to pending Nyuni license.

I think we’ll hear something in next few months

Seems positive. A little cheer for Monday morning!

Hi Tanzania, nothing to worry about. The Omanis own about 30% of Aminex. They’re not going to sell to anyone on the cheap (and if they wanted to take Aminex out cheaply themselves, they have had ample opportunity and not done so)

More interesting news today. The government of Qutar and Jenkins Energy Group are about to go on a $15bn spending spree of African gas assets.

Some key quotes from the article:

“the move, which is to invest in the huge but largely untapped gas reserves in Africa, will see Jeniks Energy Group leap frogged to a global gas investment firm”.

‘‘Some of the key areas of focus by the Qatar government Investment include the Gas Reserve Acquisition, Liquified natural Gas and LPG projects across the 11 countries of Africa – Nigeria, Ghana, Kenya, Republic of Congo, Guinea Equatorial, Senegal, Gabon, Angola and Tanzania.’’

I can’t see She’ll or Equinor wanting to sell any of the offshore asset now that things are finally progressing for them.

So, which huge and largely untapped gas reserves in Tanzania could they be interested in?

Link to the article:

https://leadership.ng/stakeholders-commend-energy-group-qatar-partnership

Quite shocking to hear that Dar Ed Salaam is about to endure a 10 day power cut because of works to expand Kinyerezi I power station. The power situation sounds pretty desperate.

With Kinyerezi being expanded from 150 to 335MW this year and Umbungo III from 60 to 112MW, that’s about 240MW of additional gas fired power that is about to come on stream.

With limited supply headroom, this must surely pile the pressure on to get Kiliwani back up and running.

Link to the article:

https://www.ippmedia.com/en/news/dar-set-10%C2%A0day-power-cut

Tested 1p a couple of times in last week or so. Entering a news window. Possible news on 3D seismic, rig order and spud date, Kiliwani remediation plans, Nyuni license award. News next week? Vox markets forecast 1.3 to 1.4p by end of Feb. We all know that more is possible with the right news and the speed this baby can move. Happy Friday Aminexers!

An interesting article in The Citizen newspaper today about power blackouts in Tanzania and the reasons why. Sounds like power generation is at the limit. I believe that as soon as they know for sure that we have the gas, they will press ahead with the Mtwara and the Somanga Fungu gas fired power stations.

Here are the reasons that the article cites for the power blackouts:

“the frequent blackouts are most probably caused by:

One, with every new house, office, or event hall, the distribution capacity is being stretched to the limit. Often, power levels are pathetically low – yet new clients are being added. Technically, this is what can cause transformers, conductors, and substations to fail intermittently. This implies no upgrades in substations and transformers.

Two, generation capacity is low. I made this argument in an earlier article, and I stand by my analysis that all indicators show that there is a challenge in capacity. When substations don’t receive enough power, the effects are cascaded to end users”.

Link to article:

https://www.thecitizen.co.tz/tanzania/oped/what-is-behind-the-dramatic-return-of-power-blackouts--3695904?view=htmlamp

Completely agree Jettydog

Not far fetched at all jackpack

2004 - previous Aminex Chairman Brian Hall:
"The oil traces identified in Nyuni-1 could possibly be the key to the oil potential of the whole region“

APR 2013 - then Aminex EXPLORATION DIRECTOR, MIKE REGO:
An Aminex Plc article1 written by the former Exploration Director, confirms the company’s view that “beyond doubt” oil has been generated in the region. The same article explains that as much as 56 billion bbls of oil (equivalent to 336 TCF of gas) may have migrated to the onshore Ruvuma Basin (where Ntorya/Chikumbi is located). The article includes a diagram clearly showing Ruvuma as one of the “Best locations for oil”

FEB 2017 – FROM Ntorya-2 Well Drilling Result RNS:
“Ntorya-2 also encountered traces of oil in the gross reservoir interval and the company is now evaluating the implications of this positive development through an updated basin model”

JUNE 2017 - then Aminex Ceo, JAY BHATTACHERJEE:
“Ntorya-3 [Chikumbi-1]…we want to make sure we maximise as many targets as we possibly can. We are working on a basin model and evaluation some of the deeper targets for liquids”.

;-)

Hi blackgold, it is worth bearing in mind that the gas from Ruvuma will be considerably cheaper to produce than that from the deep offshore fields. I suspect that Tanzania will want to prioritise that cheaper gas for themselves.

If there is a scenario where our gas is used for export (e.g. Ruvuma has been linked with gas pipeline to Uganda) then our cost advantage gives us competitive edge to secure that too. In that scenario, there is perhaps a little less price pressure as it would be politically awkward for the ruling party if the gas sold domestically was seen as hugely expensive. So that could give us more room to negotiate ourselves.

Domestic consumption is increasing fast. We know there are some big gas hungry projects planned including the $2bn fertilizer factory. Also, Tanzania wants to export power/electricity and part of their plans to achieve that includes new gas fired power plants (inc. Mtwara 300MW and Somanga Fungu 330MW). With proposed gas pipelines to export to Uganda, Kenya and beyond, there will be a lot of demand to be met by the time the LNG facility comes on stream. The Omanis are astute business people. I’m sure they wouldn’t be spending time and money if they weren’t confident that the supply/demand equation stacks up ;-)

You need to read the RNS in this context. As stated in the accounts:

“The Company is in a position whereby PRESERVATION OF CAPITAL IS CONSIDERED TO BE PARAMOUNT. Consequently, SALARIES HAVE BEEN REDUCED AND NO BONUSES AWARDED to the Executive Directors in 2020. It is the intention that both executives and staff should be accordingly compensated, in the meantime, through the award of options under the current share option plan”

SO, THIS IS NOT GREED. IT IS PRESERVATION OF THE COMPANY.

Also, regarding the price set for the options, this is not something that the Directors decide on the fly. The process for that is also set out in the accounts:

“Executive Share Option Scheme ("ESOS"). Under the terms of the ESOS, certain Directors and employees of Aminex PLC, and its subsidiary companies, are entitled to subscribe for Ordinary Shares in Aminex PLC at the market value on the date of the granting of the options. Options are granted at market price, in accordance with the ESOS rules, with reference to the average closing price for the fourteen days prior to the grant of options”