Junior energy firm Solo Oil announced Wednesday that its purchase of a stake in its Kiliwani North Development Licence in Tanzania can go ahead.
Solo said that the operator of the license, Aminex, has received confirmation from the Tanzanian Ministry of Energy and Minerals that the country's energy minister has no objection to the proposed sale by Aminex of a 13-percent interest in Kiliwani North to Solo for $7 million.
Completion of the initial 6.5-percent interest now remains subject only to a formal Deed of Assignment being signed by all participating parties, Solo said. However, the deadline for the purchase of both the initial and additional 6.5 percent of the license has been delayed to Jan. 30, 2015, as a result of the longer-than-expected time taken to obtain approval.
The Kiliwani North license contains the Kiliwani North-1 well, which is expected to start production at approximately 20 million cubic feet of gas per day in early 2015. Resources that exist on the license are estimated at 45 billion cubic feet of gas in place. A gas sales agreement for the license is also "largely complete" and is expected to be ready by the end of 2014.
Once the sale to Solo is complete, the license's joint venture partners will be Aminex with a 52-percent stake, RAK Gas with a 25-percent interest, Bounty Oil with 10 percent and Solo with 13 percent.
Solo Chairman Neil Ritson commented in a company statement:
"The final step in the process of receiving approvals to our acquisition of an interest in the soon to be producing Kilwani North development has now been received and we look forward to signature of the gas sales agreement and to the start-up of the production in 2015."
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