Wentworth Resources Plc : Posting of Annual Report, Notice of 2019 Annual General Meeting, Operational Update
PRESS RELEASE 15 May 2019
WENTWORTH RESOURCES PLC
("Wentworth" or the "Company")
Posting of Annual Report
Notice of 2019 Annual General Meeting
Wentworth (AIM: WEN), the AIM listed independent, East Africa-focused oil & gas company, is pleased to announce the following updates.
Further to the announcement of the Company's results for the year ended 31 December 2018 on 24 April 2019, Wentworth confirms that the Annual Report and Financial Statements for the year ended 31 December 2018 are available on the Company's website at www.wentplc.com. Hard copies have today been posted to those shareholders who elected to receive them, together with documentation for the 2019 Annual General Meeting.
The Annual General Meeting is scheduled to be held at 10.00am on Wednesday 26 June 2019 at the offices of Pinsent Masons, 30 Crown Place, Earl Street, London, EC2A 4ES.
Monthly payments continue to be consistently received from both Tanzanian Petroleum Development Company ("TPDC") and Tanzania Electric Supply Company Limited ("TANESCO") and arrears due from both off-takers continue to remain at three months.
As previously announced, the 2012 Ziwani-1 exploration well and associated 3D seismic costs were paid by Maurel et Prom ("M&P") and Cove Energy as part consideration for their entry into the Mnazi Bay asset, thereby fully carrying Artumas, now Wentworth, (the "Ziwani Carry"). The net Ziwani Carry was $8.4 million. Sustained, regular payments have enabled Wentworth to settle the Ziwani carry, with the final deduction of $1.3 million being made in January 2019.
The Company has also made the final contingent payment to PTT Exploration and Production Public Company Limited ("PTTEP") of $441k, net to Wentworth. Following this payment, Wentworth has no further ongoing liability to PTTEP.
Production guidance for 2019 of 75 - 85 MMscf/d remains unchanged. Average production to end April 2019 was 73 MMscf/d, materially impacted by increased hydro-electric supply during the rainy season from March through late May and additional gas supplied into the transnational pipeline from SongoSongo. The Company expects to see existing demand underpinned and set to increase over the second half of 2019, due to:
- The current wet season expected to be over by late May 2019 and thus output from the hydro-electric plants will diminish;
- Repairs to the three turbines at Ubungo II plant completed by end of May 2018;
- Ongoing power evacuation problems at the Kinyerezi power stations resolved by end of Q2 2019;
- Kinyerezi-1 and Kinyerezi-2 power stations to run at near full capacity for H2 2019;
- Demand from the Dangote Cement plant expected to increase in the coming months as gas generation increases with the retirement of its older diesel plants;
- The new Kinyerezi-1 Extension TANESCO facility is expected to begin its commissioning phase starting Q3 2019, gradually bringing on-stream demand of c.24 MMcf/d over the remainder of 2019, with final commissioning in 2020.
Workover and Pressure Monitoring. The operator, M&P, has successfully completed a workover and pressure monitoring campaign involving slick-line operations on the Mnazi Bay wells. The pressure monitoring data is in-line with expectations and looks to continue for the foreseeable future with the goal of further delineating potential upside, especially in the lower MB sand packages. The accompanying slick-line work performed on the MB-2, MB-3 and MB-4 wells was part of an on-going production strategy by M&P to optimize production over the life of the field. Further routine operations are expected throughout 2019.
Inlet pressure. TPDC agreed on 17 April 2019 to reduce the inlet delivery pressure to the transnational pipeline at the Madimba Gas Processing Facility ("Madimba GPF"), from 95barg to 85barg. Decreasing the inlet delivery pressure increases volumes available prior gas compression capex, gives the Joint Venture more flexibility to operate the wells, allows management of the reservoir efficiently, and extends production plateau or production at higher rates in the current configurations, all things being equal. The Company views this as a positive step and shows a spirit of co-operation and pragmatism amongst the stakeholders of the Mnazi Bay Concession.
Tembo appraisal block, Mozambique. On 25 April 2019, the Company received approval of the relinquishment of the Tembo Appraisal Block from the Honourable Minister of Natural Resources and Energy. The Company has now closed its office in Maputo and is working with the Instituto Nacional de Petroleo ("INP") to transfer the remaining assets, namely the Palma Camp back to the Government of Mozambique. Disposal of legacy surplus drilling inventory stored at the Muxara Camp in Pemba is expected to be completed by late May 2019. The Company is taking the necessary actions, in accordance with Mozambique Petroleum Law and industry best practice, to ensure that all liabilities relating to the concession area, especially in relation to environmental issues, are conclusively dealt with prior to a full and final exit of the block by 15 June 2019.
Eskil Jersing, CEO, commented:
"We continue to improve our fundamentals, with regular revenue receipts, debt reduction, completion of the Ziwani carry payment and final payment to PTTEP.
We maintain our 2019 production guidance and have line of sight to increasing demand in H2 2019 and beyond. The agreement to an inlet pressure reduction at Madimba is a key commercial trigger and it is encouraging that the Joint Venture has been able to agree on a pragmatic first step, with all the associated look-through benefits to asset value.
Our Mozambique country exit continues smoothly, on time and with no liability exposure.
With regards to M&A due diligence efforts, we have worked hard over the last six months on a range of transaction options both at a Corporate and asset level and feel confident at being able to execute on inorganic, self-sustaining growth opportunities in 2019."
| Enquiries: |
| Eskil Jersing, |
Chief Executive Officer
Chief Financial Officer
| email@example.com |
+44 (0)118 2065427
+44 (0)118 2065428
Stifel Nicolaus Europe Limited
AIM Nominated Adviser and Joint Broker
+44 (0) 20 7710 7600
|Peel Hunt LLP|| Joint Broker |
|+44 (0) 20 7418 8900|
Investor Relations Adviser
+44 (0) 20 7390 0230
About Wentworth Resources
Wentworth Resources is a publicly traded (AIM: WEN), independent oil & gas company with natural gas production, exploration and appraisal opportunities in the Rovuma Delta Basin of coastal southern Tanzania.
The information contained within this announcement is deemed by Wentworth to constitute inside information as stipulated under the Market Abuse Regulation (EU) no. 596/2014 ("MAR"). On the publication of this announcement via a Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.
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. 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.