Business
MILESTONE GAS SALES AGREEMENT SECURED
MILESTONE GAS SALES AGREEMENT SECURED.
About this update from Aminex Plc
[{"type":"text","content":"\n \nRNS Number : 6603L Aminex PLC 13 January 2016 \n\n \nAminex plc\n(\"Aminex\" or \"the Company\")\n \nMILESTONE GAS SALES AGREEMENT SECURED\nAminex set to start first production in Africa\n \nAminex is pleased to report today that it has executed a fully-termed Gas Sales Agreement (\"GSA\") with the Tanzania Petroleum Development Corporation (\"TPDC\") for its Kiliwani North gas field, which moves the Company into its much anticipated production phase. \n \nHIGHLIGHTS:\n \n· Milestone agreement moves the Company into producing phase;\n· Take-or-pay depletion contract with gas revenues payable in US Dollars;\n· Initial gas price of US$3.00 per mmbtu (approximately US$3.07 per mcf);\n· Effective date of GSA 31 December 2015;\n· Annual indexation of gas price from 1 January 2016; and\n· Agreed payment security mechanism\n \nParticipants in the Kiliwani North Development Licence are: Ndovu Resources Ltd (Aminex) 55.575% (operator), RAK Gas LLC 23.75%, Bounty Oil & Gas NL 9.5%, Solo Oil plc 6.175% and TPDC 5%.\n \nThe Kiliwani North GSA allows for the expected depletion of production from the field over time. In each contract year TPDC will be required to purchase, take delivery of or pay for a pre-determined volume of gas. In the event that TPDC elects not to take delivery of the pre-determined volume, it will pay for the equivalent of 85% of the agreed commercial rate of gas to be supplied, adjusted each year in accordance with the terms of the GSA. Gas from Kiliwani North will be supplied to the recently completed Songo Songo gas processing plant. \n \nFinal well preparations, which are currently ongoing, are being completed prior to testing and commissioning of the new plant. During this phase production rates will be varied to optimise well life and establish commercial rates. During the testing and commissioning phase, the TPDC will be invoiced for gas produced at the end of each month and will be required to pay on invoice. \n \nThe start of commercial operations will be mutually agreed between the TPDC and the Company after testing and commissioning has been completed. Each month, the TPDC will be required to pay o...