Kiliwani North Development Update

RNS Number : 1559B

Solo Oil Plc

05 October 2015

 

FOR IMMEDIATE RELEASE, 7 am                                                                                                5 October 2015

SOLO OIL PLC

("Solo" or the "Company")

Kiliwani North Development Update

Solo is pleased to announce that it has been notified by the operator that the Tanzania Petroleum Development Corporation ('TPDC') intends to exercise its right to back into the Kiliwani North Development Licence ('KNDL') for a 5% working interest as a fully paying partner.  The assignment of the interest to TPDC will be subject to TPDC 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.  Once the back-in is concluded Solo's interest in the KNDL will be 6.175% (current interest 6.5%).   

Neil Ritson, Solo's Chairman, commented:

"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."

The KNDL contains the Kiliwani North 1 ("KN-1") well, which the Company expects to produce at 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. 

A gas sales agreement ("GSA"), with appropriate payment guarantee provisions, is pending signature and once signed will allow gas to flow from the KNDL to the newly constructed Songo Songo Island gas processing facilities and into the national pipeline to customers in Dar es Salaam.  The operator continues to report the imminent conclusion of the GSA discussions.

Solo 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 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.

Participants in the Kiliwani North Development Licence are currently: Ndovu Resources Ltd (Aminex) 58.5% (operator), RAK Gas LLC 25%, Solo Oil plc 6.5% and Bounty Oil & Gas NL 10%.

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 Pascal Keane Jerry Keen (Corporate Broker) Bell Pottinger                            Public Relations Henry Lerwill Cassiopeia Services LLP Investor Relations Stefania Barbaglio	[phone] [phone] [phone]

 

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