According to a statement by Solo oil plc, a partner with Tanzania on the project, the assignment of the interest to Tanzania Petroleum development Cooperation will be subject to paying the existing joint venture partnership the 5% pro-rata share of the development capital spent to date and to complying with the existing Joint Operating Agreement.
Solo oil plc further expressed optimism about the TPDC’s move saying that the back-in will will help rise its interest in the North Kiliwani Project to 6.175% away from the current interest 6.5%.
“Solo is delighted that TPDC have chosen to exercise their back-in rights which will further increase their alignment with the partnership developing Kiliwani North. We continue to anticipate reaching final agreement on the gas sales agreement shortly and gas sales revenues commencing soon after.” Solo’s Chairman,Neil Ritson, reacted
The KNDL contains the Kiliwani North 1 (“KN-1”) well, which the solo expects to produce up to approximately 30 million feet per day of gas (gross). Once producing this will represent a major milestone for Solo, providing the Company’s first revenues from its investments in Tanzania.
Meanwhile Gas Sales Agreement (GSA) between various stakeholders and Tanzania, is pending signature. The concessions once signed will allow gas to flow from the KNDL to the newly constructed Songo Songo Island gas processing facilities.
The initial gas plan also entails movement through the national pipeline to customers in Dar es Salaam.
Solo says it holds an option to increase its interest in the KNDL by 6.5% to a total of 13% once the GSA is signed for a further payment of US$3.5 million to London based Aminex.
“This option will also be subject to TPDC back-in once concluded. Solo would then hold a 12.35% working interest in the Licence ” solo noted in a statement.
See Aminex Press release