By Hussein Boffu
If Aminex was a person, his nickname would be “Early Bird” for its ability to notice an opportunity in the Ruvuma basin so early.
Sound Confusing? Let me clarify.
Early birds are people who take early advantage of a situation. They have eagle eyes to notice opportunities (even if it’s wrapped up) and grab it swiftly.
London-based independent exploration and production company, Aminex it is.
Aminex recognized the potential and opportunities which lie in the Ruvuma basin and they took a first-mover advantage in the Tanzania’s oil and gas sector, having been investing in the country since 2002.
I have been following Aminex for a while now and tracking their progress in Tanzania.
In July 2018, Aminex agreed to “farm out” 50% interest of its Ruvuma acreage onshore Tanzania to Zubair Corporation’s associate, Ara Petroleum Tanzania limited. Aminex maintain a 25% in the license.
Under the deal, Aminex assigned the operatorship to Ara Tanzania Petroleum Limited to do the actual drilling of the Chikumbi-1 exploratory well and interpret 3D seismic over 200 km square.
Here is an elaboration if you are not familiar with what the “farm out” means.
Technically speaking, oil and gas companies might have good acreage that foresee they will not be able to drill; so, they could agree to farm out the license to someone else and give the right to do actual drilling. In that case, farm out benefits both parties.
It gives the owner of the license the right to some of the future production without any cost or risk of drilling or even developing the field and allows the other company to gain the right to drill with no cash investment. That’s a win-win situation.
Additionally, on November 6, Aminex announced that its field partner, Ara Petroleum Tanzania Limited, has started the process to establish a local operation office in Dar es Salaam as well as already hired managerial personnel to maximize the efficiency in their Tanzania projects.
Furthermore, in its latest announcement, the company says that it has submitted the 2020 Work Programmes and Budgets for all licences to the Tanzanian authorities for approval.
The submitted programmes include the cost of drilling Chikumbi-1 well and the acquisition of 2D and 3D surveys over the Mtwara license, all for US$40 million.
Also, Aminex’s field partner, Ara Petroleum Tanzania Limited, has agreed to accelerate pre-drilling activities of Chikumbi-1 well.
The activities include the construction of an access road to the Chikumbi-1 well site, the construction of the drilling surface location, the ordering of select long lead items, and progress permitting activities.
With increasing demand for natural gas in Tanzania, It is suffice to say that the time is really now for Aminex.
Drilling Contractor Secured
Back in December 2018, the company announced that it has selected Sakson Drilling and Oil Services DMCC to drill the Chikumbi-1 well. The well is planned to be a total measured depth of approximately 3,485 meters.
What’s Next for Aminex?
As noted earlier, the year 2018 to 2019 was a big one for Aminex PLC. It already secured a drilling contractor to drill Chikumbi-1 well. It signed a farm out deal with Zubair Corporation’s associate, Ara Petroleum Tanzania limited. The company will not only benefit from financial input but also from the experience of personnel of Ara Petroleum Tanzania Limited.
The company also submitted its 2020 working program to the Tanzanian authority.
So, all signs point to a drilling program of Chikumbi-1 well. And who knows? We hope to witness Aminex announce the drilling program of Chikumb-1 well,