Wentworth Signs Long-term Gas Sales Agreement for Mnazi Bay and Msimbati Gas Fields Tanzania
GlobeNewswire
PRESS RELEASE
15 September 2014
Wentworth Resources Limited
("Wentworth" or the "Company")
Wentworth Signs Long-term Gas Sales Agreement for Mnazi Bay and Msimbati Gas Fields Tanzania
Wentworth, the Oslo Stock Exchange (WRL.OL) and AIM (WRL.L) listed independent, East Africa-focused oil & gas company, announces that it has signed a gas sales and purchase agreement ("Mnazi Bay GSA") with TPDC, along with Mnazi Bay license partners Maurel et Prom ("M&P") and Tanzania Petroleum Development Corporation ("TPDC") (together the "Mnazi Bay Partners"). The Mnazi Bay GSA covers the long-term sale of natural gas from the Mnazi Bay and Msimbati fields in southern Tanzania to the Government owned and operated Mtwara to Dar es Salaam pipeline and Madimba central processing facility ("Pipeline Project"), which is currently under construction and scheduled for completion and commissioning in Q1 2015.
Pursuant to the Mnazi Bay GSA, the Mnazi Bay Partners are contracted to supply to the Pipeline Project up to a maximum 80 mmcf/day of natural gas during the first eight months with an option to increase over time to a maximum 130 mmcf/day of natural gas for up to a 17-year supply period. The Mnazi Bay GSA is subject to certain conditions, including the Tanzanian Government providing all necessary approvals and an executed version of payment security agreements prior to delivery of first gas.
The initial delivery is expected to begin during the period 22 January 2015 and 22 April 2015 and be at a fixed price of US$3.00 per mmbtu (approximately US$3.07 per mcf), escalating with United States CPI Industrial index. The gas will be sold and purchased at the inlet to a 16 inch pipeline connecting the Mnazi Bay gas production facility to the Madimba central processing facility. The Mnazi Bay Partners are not responsible for paying a tariff for transporting the gas nor are they paying for any third party processing fees.
With a long-term contract in place, the Mnazi Bay Partners will use the time before the commencement of first gas delivery to finalize the design, construct, and commission the necessary surface infrastructure, including separation facilities and flow lines, to tie existing wells into the Pipeline Project. Gas will be produced from the existing four wells in the Mnazi Bay and Msimbati fields and these wells are expected to be capable of producing natural gas sufficient to meet the initial 80 mmcf/day delivery volumes under the Mnazi Bay GSA.
Bob McBean, Executive Chairman of Wentworth, commented: "The signing of the Mnazi Bay GSA is a significant advancement in the development of the gas industry and lays the foundation for the future domestic gas development in Tanzania. Additionally, this agreement is a major milestone in Wentworth`s gas monetisation strategy to commercialise our discovered gas resources, taking us a step closer to reclassifying our resources to reserves, and is a significant value driver for the Company. I would like to thank all parties involved for the professionalism and dedication shown during the negotiation process."
"Following the processing and interpretation of recently acquired high resolution 2D data over the Mnazi Bay and Msimbati gas fields we plan to commence a development drilling programme with the aim of increasing production up to 130mmcf/day. We maintain a strong commitment to exploring for oil and gas in the Ruvuma Basin, within Tanzania and Mozambique, and expect to be in the enviable position of having positive cash flow available to fund both our exploration and development capital programmes in 2015."
About Wentworth Resources Wentworth Resources is a publicly traded (OSE:WRL, AIM:WRL), independent oil & gas company with: natural gas production; midstream assets; a committed exploration and appraisal drilling programme; and large-scale gas monetisation opportunities, all in the Rovuma Delta Basin of coastal southern Tanzania and northern Mozambique.
Wentworth holds a 31.94% participation interest in production operations and a 39.925% participation interest in exploration operations of the Mnazi Bay Concession. M&P is operator and holds a 48.06% participation interest in production operations and 60.075% participation interest in exploration operations with TPDC holding the remaining 20% participation interest in production operations.
Gerold Fong, Vice President of Exploration (BSC Geophysics, 1982) who has 31 years of experience in the exploration and production industry, has read and approved the technical disclosure in this regulatory announcement.
Cautionary note regarding forward-looking statements This press release may contain certain forward-looking information. The words "expect", "anticipate", believe", "estimate", "may", "will", "should", "intend", "forecast", "plan", and similar expressions are used to identify forward looking information.
The forward-looking statements contained in this press release are based on management`s beliefs, estimates and opinions on the date the statements are made in light of management`s experience, current conditions and expected future development in the areas in which Wentworth is currently active and other factors management believes are appropriate in the circumstances. Wentworth undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless required by applicable law.
Readers are cautioned not to place undue reliance on forward-looking information. By their nature, forward-looking statements are subject to numerous assumptions, risks and uncertainties that contribute to the possibility that the predicted outcome will not occur, including some of which are beyond Wentworth`s control. These assumptions and risks include, but are not limited to: the risks associated with the oil and gas industry in general such as operational risks in exploration, development and production, delays or changes in plans with respect to exploration or development projects or capital expenditures, the imprecision of resource and reserve estimates, assumptions regarding the timing and costs relating to production and development as well as the availability and price of labour and equipment, volatility of and assumptions regarding commodity prices and exchange rates, marketing and transportation risks, environmental risks, competition, the ability to access sufficient capital from internal and external sources and changes in applicable law. Additionally, there are economic, political, social and other risks inherent in carrying on business in Tanzania and Mozambique. There can be no assurance that forward-looking statements will prove to be accurate as actual results and future events could vary or differ materially from those anticipated in such statements. See Wentworth`s Management`s Discussion and Analysis for the year ended December 31, 2013, available on Wentworth`s website, for further description of the risks and uncertainties associated with Wentworth`s business.
Notice Neither the Oslo Stock Exchange nor the AIM Market of the London Stock Exchange has reviewed this press release and neither accepts responsibility for the adequacy or accuracy of this press release.
This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act. 2014 09 15 Press Release
This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein. Source: Wentworth Resources Limited via GlobeNewswire HUG#1855828
