Aminex Petroleum Wins Extension on Mtwara License
Aminex Petroleum Services Ltd. has received an extension of the Mtwara License from the Ministry of Energy of Tanzania. It was one of the last conditions the company needed in order to close the farm-out agreement with ARA Petroleum Tanzania Ltd. The agreement will carry the company for up to $35 million of its share of costs associated with the development of the Ntorya field, essentially carrying the company through to gas production in Tanzania.
The extension is valid for one year. Under the extension terms, through the Ruvuma PSA Joint Venture, Aminex is committed to performing the following:
• Acquiring 200 square kilometers (surface coverage) of 3D seismic
• Drilling the Chikumbi-1 exploration well
• Negotiating the gas terms for the Ruvuma PSA with the Tanzania Petroleum Development Corp.
• Using the data gathered from Chikumbi-1 and the seismic acquisition, preparing an application for a development license for the Ntorya area
“With this license extension granted, we now have line of sight towards the development of a nationally important resource with the drilling of the Chikumbi-1 well,” John Bell, Chairman, said in a written statement.
“Fortunately, gas prices in Tanzania are not linked to the price of crude oil and given the shortage of gas, demand is strong. We have long since believed in the value of this field to Tanzania and to the Aminex shareholders and are delighted, at long last, to once again be moving into the growth and operational phase that will further de-risk the 763 billion cubic feet of 2C resources at the Ntorya field.”
“We are right skilling and right sizing the company for a world where our key asset, the Ruvuma PSA, goes from being an operated asset to a non-operated asset following the successful license extension farm-out to APT, which will hold 50% of the license leaving Aminex with a 25% interest and a full carry to potentially significant volumes of production,” Aminex said in a written statement.
Separately, the company has named Robert Ambrose as interim Chief Executive Officer. He was previously a nonexecutive director and formerly the Chief Operating Officer of the Energy & Logistics Division of The Zubair Corporation LLC. Tom Mackay has stepped down from as interim CEO and as a Aminex director, effective immediately.
Ambrose will receive an annual salary of £60,000 (a reduction of almost 70% from the £180,000 salary of the previous CEO) and will be awarded stock options instead of cash, In addition, effective April 1, non-executive directors John Bell and Linda Beal have given up all their director fees for stock options. Some staff have furloughed and the whole UK management team has taken a 20-40% temporary reduction in salary to assist the company’s cashflow.
The director and staff cost savings will reduce outbound cash by around $75,000 per month, resulting in annual savings of $900,000, according to the company.
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