Interim Management Statement

RNS Number : 1449I

Aminex PLC

14 November 2008

 



14 November 2008

Aminex PLC

Interim Management Statement

Aminex PLC ("Aminex"), the oil and gas company listed on the London and Irish Stock Exchanges, today issues its Interim Management Statement ("IMS") for the period from 1 July 2008 to the date of this statement in accordance with the EU's Transparency Directive which requires certain listed companies to provide periodic updates to the capital markets in addition to their existing reporting requirements.

In this statement the following abbreviations are used:

"mmscfd" = millions of standard cubic feet per day

"bcpd"1 = barrels of condensate per day

US Drilling & Seismic

The Sunny Ernst-2 well at Alta Loma, Galveston County, Texas was successfully drilled to a depth of 14,900 feet during the period and on 21 August was announced as a commercial discovery having logged several potentially gas-bearing zones. Testing was initially delayed following severe hurricane damage in the Galveston area. On 30 October the Company announced successful testing of two deeper zones, known as the "Massive Sands" (1.7 mmscfd and 100 bcpd) and the "Upper Andrau" formation (6.1 mmscfd and 342 bcpd). The thickest of the formations logged, known as the "S" Sand and comprising roughly 60 feet (18 metres) of net gas bearing sand will not be perforated and completed for production until commercial arrangements are in place for transporting and selling a greatly increased volume of gas, currently in progress. Meanwhile the Upper Andrau formation alone is now delivering approximately 7 mmscfd into the pipeline and producing approximately 350 bcpd. Condensate is sold at prices comparable to WTI crude oil. This Upper Andrau production alone is now making a significant contribution to the Company's net revenues despite generally weaker commodity prices. Aminex has a 37.5% interest in Sunny-Ernst-2 which is operated by El Paso Corporation. Once production history has been fully established and increased pipeline access finalised there is a strong probability of a follow-up well in 2009.

The South Weslaco 38 gas discovery well, Hidalgo County, Texas has been completed for commercial production following fracture treatment and is now on stream. Together the Company's four wells at South Weslaco are producing approximately 3 mmscfd. Aminex has a 25% working interest in this well which is operated by Kaler Energy.

Shoats Creek Field, Calcasieu Parish, Louisiana.  New 3D seismic over this field is currently being integrated with existing well data. Initial evaluation has indicated untested potential in the "Wilcox Sands" but at a greater depth than has been previously drilled. Work is ongoing. Aminex has a 100% working interest in this field and is the operator.

East African Operations

Nyuni Licence, offshore Tanzania:  A location area has been provisionally agreed with the Tanzanian authorities for appraisal of the Kiliwani North gas discovery which was drilled in the first half of the year, flowing gas at 40 mmscfd under full production test conditions. Negotiations are in progress for a sustained production test into the nearby pipeline prior to submitting a full development plan to the government and being granted a development licence. New seismic will be acquired as early as possible in 2009 with a view to defining the extent of the Kiliwani North discovery and better defining other leads and prospects. In addition further exploration drilling is planned over the remainder of the Nyuni licence over the next two years. Aminex has a 40% interest in this licence and is the operator.

Ruvuma Licences, onshore Tanzania:  The first of two back-to-back exploration wells is due to be spudded in the 12,000 square kilometre Ruvuma PSA area during the first quarter of 2009. These will test separate prospects. The Ruvuma River is the border between Tanzania and Mozambique to the south. On the Mozambique side all prospective acreage is licensed and there are preparations in hand for several separate drilling campaigns. Aminex holds the principal onshore acreage on the Tanzanian side of the river where the primary target is oil rather than gas. Aminex has a 50% interest in these licences which are operated by Tullow Oil.

West Songo-Songo, Tanzania:  Seismic and exploration drilling is planned over the next two years. Aminex has a 50% interest in this licence which is operated by Key Petroleum.

L-17 & L-18, nearshore Kenya:  Seismic is planned over these licences in 2009. Aminex has a 25% interest and is the operator.

Egypt Drilling

At West esh el Mellahah Block 2 ("WEEM-2") in the onshore Gulf of Suez region, two of three obligation wells have now been drilled at no cost to Aminex but without encountering commercial hydrocarbons. Despite lack of drilling success to date this area is still considered to be very prospective for oil and gas. One or more wells will be drilled in 2009. Aminex has a 10% beneficial interest in WEEM-2 and its share of costs is carried by other partners through to first commercial production. WEEM-2 is operated by Aminex Petroleum Egypt Ltd., in which Aminex is a shareholder.

Financial

Aminex issued its interim results statement for the six month period ended 30 June 2008 on 29 August 2008. Trading from the beginning of the third quarter to the date of this report has been approximately in line with the Group's expectations. Commodity prices are currently falling although this is likely to be offset by increased oil and gas production together with a reduced cost basis due to a weakening of Sterling against the U.S. dollar. Savings made through disposing of the Company's interests in Madagascar earlier in the year have to some extent been offset by increases in exploration costs elsewhere.

Outlook

The recent successful well at Alta Loma, Texas should provide the Aminex group with important new cash flow at a time of general financial stringency. As well as working to build up its US production revenues, Aminex has an ambitious ongoing exploration and appraisal programme in East Africa and will take all necessary steps to protect its position as a leading explorer in this very promising region.

For Aminex PLC,

Brian Hall        Chairman

Simon Butterfield    Finance Director

For further information:

Brian Hall	Aminex	[phone]
Archie Berens	Pelham PR	[phone]

 

END

 

 

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