Update Ruvuma PSA, Tanzania

RNS Number : 2774C

Solo Oil Plc

27 June 2016

 

FOR IMMEDIATE RELEASE, 7 am                                                                                                27 June 2016

SOLO OIL PLC

("Solo" or the "Company")

Update Ruvuma PSA, Tanzania

Solo Oil is pleased to announce that operator Aminex plc ("Aminex") has successfully completed discussions with the Tanzanian Petroleum Development Corporation ('TPDC') in relation to extending the licence term for the Mtwara Licence of the Ruvuma Production Sharing Agreement ('Ruvuma PSA') in Tanzania which was previously due to expire late December 2016.  A one-year extension has been approved by TPDC, which is processing the extension for immediate Ministerial approval.

Aminex has also completed discussions with the TPDC with regards to transferring the outstanding drilling obligations in the northern Lindi Licence ("Lindi"), also covered by the Ruvuma PSA, into the southern Mtwara Licence ("Mtwara").  Mtwara includes the approved appraisal area for the Ntorya gas condensate discovery.  TPDC is supporting the transfer of the Lindi drilling obligations to Mtwara and is seeking Ministerial consent. Once consent is received, Aminex and Solo intend to drill the Ntorya-2 appraisal well which will satisfy the appraisal drilling obligation and it is then expected that the Solo-Aminex partnership will apply for a 25-year development licence for the Ntorya discovery.

Elsewhere in Tanzania, and as recently announced, the power generation system and other auxiliary facilities at the Songo Songo Island gas processing plant have been commissioned and the commissioning of the remainder of the gas plant and sub-sea pipeline commenced on 4 April 2016.  The Kiliwani North-1 ("KN-1") well continues to be the sole producer to the TPDC gas processing plant on Songo Songo Island during the commissioning and is expected to reach production levels of up to 30 mmscfd shortly.  Gas from KN-1 will be processed at the new Songo Songo Island gas plant and will ultimately be transported by pipeline to Dar es Salaam, where it will be sold into the local Tanzanian market.

Neil Ritson, Solo's Chairman, commented:

"Solo is very pleased with progress in the Ruvuma PSA and that we will shortly be in a position to commence the appraisal of the Ntorya-1 gas condensate discovery which we remain convinced has substantially more potential than the gross 70 bcf of gas booked to contingent resources this far.  We look forward to an announcement from Aminex on the expected spud date for the Ntorya-2 well in due course."

Qualified Person's Statement:

The information contained in this announcement has been reviewed and approved by Neil Ritson, Chairman and Director for Solo Oil Plc who has over 38 years of relevant experience in the energy sector.  Mr. Ritson is a member of the Society of Petroleum Engineers, an Active Member of the American Association of Petroleum Geologists and is a Fellow of the Geological Society of London.

For further information:

Solo Oil plc Neil Ritson Fergus Jenkins	[phone]
Beaumont Cornish Limited Nominated Adviser and Joint Broker Roland Cornish	[phone]
Shore Capital Joint Broker Jerry Keen (Corporate Broker) Bell Pottinger                            Public Relations Henry Lerwill Cassiopeia Services LLP Investor Relations Stefania Barbaglio	[phone] [phone] [phone]

Notes to Editors

Ruvuma Production Sharing Agreement (25%)

The Ruvuma acreage includes the Ntorya-1 onshore Cretaceous gas condensate discovery which has been independently ascribed 70 bcf gross contingent (2C) resource in the Ruvuma Basin.  The well tested at 20 mmscfd.  The operator, Aminex (75%), is currently appraising the discovery as well as continuing exploration activity on the licenced area in the prospective Ruvuma Basin.

Kiliwani North Development Licence (6.175%)

The Kiliwani North Field has been independently ascribed with 28 bcf gross contingent (2C) resource and is producing dry clean gas under high natural pressure (1,600 psi) from the high quality Neocomian to late Cretaceous reservoir.  The Kiliwani North-1 well tested at 40 mmscfd.  The gas will be sold at the well head in US$ at a fixed price and fed directly into the Tanzania's new pipeline infrastructure to Dar es Salaam. Solo holds the right, but not obligation, to increase its share of the Kiliwani North Field to 10% as certain milestones on the project are reached.

Glossary:

bcf	billion cubic feet
contingent resources	those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations, but the applied project(s) are not yet considered mature enough for commercial development due to one or more contingencies
mmscfd	million standard cubic feet of gas per day
reserves	reserves are defined by the SPE as those quantities of petroleum, here oil and gas, which are anticipated to be commercially recovered from known accumulations from a given date forward
US$	United States of America dollars

 

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