Business
Sale of up to 13% of Kiliwani North
Sale of up to 13% of Kiliwani North.
About this update from Aminex Plc
[{"type":"text","content":"\n \nRNS Number : 1853U Aminex PLC 14 October 2014 \n\n \n \n \nAminex plc\n(\"Aminex\" or \"the Company\")\n \nSale of up to 13% of Kiliwani North Development Licence\n \n \nAminex PLC ('Aminex ' or the 'Company') is pleased to announce that it has reached a binding agreement to sell up to a 13% interest in the Kiliwani North Development Licence ('KNDL') in Tanzania (the 'Initial Acquisition') to Solo Oil PLC ('Solo') for a total consideration of $7 million. \n \nInitially Solo will acquire a 6.5% interest in KNDL from Aminex's wholly-owned subsidiary Ndovu Resources Limited ('Ndovu') for a total consideration of $3.5 million and will have a further 45-day option to purchase an additional 6.5% interest in the KNDL (the 'Second Acquisition') for $3.5 million. Aminex will use the net proceeds to reduce significantly the outstanding debt and strengthen its balance sheet. \n \nThe KNDL contains the Kiliwani North 1 ('KN1') well which the partnership expects to produce at approximately 20 mmcfd in early 2015. Once producing this will represent a major milestone for Aminex through providing first revenues from Tanzania. Independently verified resources at Kiliwani North are estimated to be 45 billion cubic feet of gas in place. Construction of a 2km pipeline from KN1 to the new Songo Songo processing plant, at no cost to the Company, has now commenced and is expected to be completed in early 2015. \n \nAdvanced negotiations for a gas sales agreement are expected to be satisfactorily concluded in the near future and the Board of Aminex notes that the Tanzanian authorities have recently finalised a similar agreement with another operator in the region. At 30 June 2014, the gross value of Aminex's share in the KNDL was $13.4 million, of which up to 20% (or $2.7 million) will be sold. Prior to first production from the KN1 well, there are no profits or losses attributable to the asset. \n \nThe key terms of the proposed disposal are set out below:\n \n1. The Initial Acquisition will consist of a cash payment of $3.5 million for 10% of Ndovu's 65% interest in KNDL, representing a 6.5% interest in the entire KNDL, payable as a refundable deposit of $250,000 within 7 days of signing the preliminary agreement, with the balance o...