Aminex has increased its interest in the Nyuni Production Sharing Agreement, Tanzania ("Nyuni") by 10%, including the 40 million cubic feet/day gas discovery at Kiliwani North under an agreement reached with East African Exploration Ltd. ("EAX").
EAX is a joint venture participant in the Nyuni PSA ("Nyuni") in Tanzania and also in the L17 & 17 PSA ("L17 & 18") in Kenya. Aminex holds 25% in L17 & 18 while EAX holds 10% in Nyuni which includes the 2008 40 million cubic feet/day gas discovery at Kiliwani North. The terms of agreement, which has been approved by the governments of both countries, are as follows:
Aminex will transfer its 25% interest in L17 & 18 to EAX.
EAX will transfer its 10% interest in Nyuni to Aminex, increasing Amine's interest in Nyuni from 40% to 50%.
Aminex will make a cash payment to EAX of $1 million.
Aminex values its cumulative investment in Kenya at its historic cost of approximately $700,000 and on the basis that it will recover its costs in Kenya and apply this recovery plus $1 million cash to the purchase of an additional 10% in Nyuni, the consideration for the purchase of this additional interest in Nyuni is $1.7 million.
New seismic has recently been acquired over Songo-Songo Island which will better define the Kiliwani North discovery at Nyuni. There are signs of progress in achieving regulatory consent for the expansion of the gas processing plant on Songo-Songo Island which will open the way for commercial development of Kiliwani North. Reprocessing of existing seismic on other prospects at Nyuni is currently well-advanced.
Commenting on the announcement, Aminex Chairman Brian Hall said, "This agreement not only increases our interest in the discovery we made last year at Kiliwani North by 25% but also consolidates our overall position in Tanzania where we are a well-established operator. In addition to Kiliwani North, other prospects on the Nyuni licence are close to being drill-ready and we believe that this represents sensible portfolio management, exiting Kenya where timing and costs are still uncertain.
"With South Malak-1 in Egypt currently drilling ahead and the Likonde-1 well in the Ruvuma Basin of southern Tanzania now scheduled to be spudded in December 2009, we are looking forward to a period of new activity on our frontier exploration projects in Africa."
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