Aminex shares boost as Tullow begins drilling in Tanzania
Published 05/01/2010 | 05:00
TULLOW Oil will this week open a new front in its successful African exploration campaign as it starts drilling on the Likonde prospect in Tanzania.
And interest for Irish investors will be doubled as Tullow is partnered in the Tanzanian project by Dublin-listed Aminex.
Excitement over the new well sent the price of Aminex stock racing ahead and, after opening with an immediate 12pc bounce, the shares closed showing a gain of 19pc on the session. Tullow was marked up 2pc at the finish, helped along by rising oil prices.
Likonde is an onshore prospect, meaning drill costs are lower and while it may be a relatively small scale project for Tullow, it is an entirely new exploration region for the company. The target is located on the Ruvuma licence and is reckoned to have the potential to hold 500 million barrels of oil in place, with estimates of recoverable reserves in excess of 150 million barrels of oil.
The Likonde-1 well will test "multiple targets" at various intervals and Aminex puts the chance of success at one in four.
Drilling is set to get under way on Thursday this week and will take about two months to complete.
Tullow has a 50pc stake in the licence with Aminex holding a further 37.5pc and the remaining stake held by Solo Oil, by way of a recent farm-in.
Separately in Tanzania, Aminex said it has agreed "commercialisation" terms for the production of gas at its Kiliwani North discovery -- even though the company said it is not yet ready to say how big the find is. The original discovery well flow tested 40 million cubic feet per day of gas, equivalent to some 6,000 barrels of oil per day.
Meanwhile, Aminex has not yet given up hope of striking a deal in North Korea, where a few years ago it signed an exclusive deal to explore the East Sea region.
An Aminex delegation to Pyongyang in November was "warmly received" the company said, adding that it has been assured the stalled process of exploring the East Sea is likely to be permitted to restart.