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Aminex making “good progress” on Ruvuma farm-out deal; extends longstop date to March

The binding farm-out agreement had been expected to be formally signed off by the end of November, but both sides have agreed to push that date back to 31 March 2019
drilling
Zubair will own 50% of the Ruvuma PSA, while Aminex is retaining a 25% stake

Aminex plc (LON:AEX) has agreed to extend the longstop completion date for the farm-out agreement it signed with Omani conglomerate The Zubair Corporation over summer.

Back in July, London-listed Aminex and Zubair struck a deal that will see the latter acquire 50% of Aminex’s working interest in the Ruvuma production sharing agreement (PSA) in Tanzania.

READ: Aminex soars as it inks Ruvuma farm-out agreement

In return, Zubair will pay US$5mln in cash in addition to fully carrying up to US$35mln in costs regarding the development of Aminex’s remaining 25% interest.

Zubair will also carry out a minimum work programme including the drilling, completion, and testing of the Chikumbi-1 well; acquiring, processing and interpreting 3D seismic data over a minimum of 200 sq km within the Ntorya project area; and establish an early production system to achieve accelerated first gas development at Ntorya to a minimum gross rate of 40mln cubic feet of gas per day (MMcf/d), which is around 6,700 barrels equivalent.

The binding agreement had been expected to be formally signed off by the end of November, but both sides have agreed to push that date back to March 31 2019.

‘Good progress’

“We are making good progress on the Ruvuma farm-out,” said Aminex chief executive Jay Bhattacherjee.

“When completed, this will accelerate development and is intended to give Aminex a full carry to significant production and free cash flows with no further recourse to funding.

He added: “The company is moving forward with its planning and preparations for the Ntorya operations, including the Chikumbi-1 well and 3D seismic acquisition.”

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