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Wentworth Resources Limited www.wentworthresources.com/
Full Wentworth Resources Limited profile here

Wentworth Resources is an independent oil and gas company with gas production and a committed oil and gas exploration programme in the Rovuma Basin of southern Tanzania and northern Mozambique. The Company and its concession partners own and operate a gas processing plant and a pipeline system in Mtwara, Tanzania. Senior management, directors and other stakeholders consist of some of the world's foremost experts on oil and gas exploration and development, midstream development and operations, and developing large-scale gas monetisation projects.

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Wentworth Resources receives US$13.5 mln payment from power plant sale

East Africa gas firm Wentworth Resources (LON:WRL) today confirmed that it has now received US$13.5 million in cash from the sale of the Mtwara power station.

It agreed the deal to sell Mtwara, an 18 megawatt gas fired plant, to Tanzania’s national electricity utility firm Tanzania Electricity Supply Company (TANESCO) last month.

Today Wentworth confirmed that it has now received payment and the asset handover will be completed in April.

Wentworth supplies gas to the Mtwara plant from its Mnazi Bay gas field, which is located nearby.

The deal allows the company to streamline its operations and focus on exploring for hydrocarbons and developing its natural gas resources, Wentworth said last month.

It also provides a meaningful cash boost for the company, which has been able to unlock cash from its asset base through a number of arrangements in recent weeks.

This cash will help the firm as it pushes forward with the development of the Mnazi Bay gas field, where an exploration well was spudded in February. The Ziwani-1 well kicks off an important work programme which is targeting Miocene and Oligocene sandstones, which are similar to the reservoirs of the nearby gas fields.

Wentworth ended 2011 with just over US$9 million in the bank, with US$4.2 million in working capital. And two deals agreed since then are set to unlock a significant amount of cash without diluting shareholders.

In addition to the Mtwara deal, Wentworth is expecting to receive around US$19 million as the result of an asset swap with Cove Energy.

The initial swap deal was valued at US$38.8 million. It saw Wentworth trade in its royalty over a LNG venture led by Anadarko Petroleum, in the deep waters off Mozambique. The royalty would have given it a 4.95 per cent share of Cove’s future net profits from the project.

Wentworth will also issue two million shares to Cove and there are also future payments, totaling US$8.5 million, subject to certain production thresholds being met at Mnazi Bay.

In return Wentworth receives a larger stake in its onshore project, Mnazi Bay.

Since the deal was struck, fellow Mnazi Bay partner Maurel et Prom has exercised what’s known as a pre-emptive right. It gives it the right to buy its proportionate share of the project equity being acquired from Cove by Wentworth.

As a result M&P will pay Wentworth around US$19 million. 

Subsequently M&P will hold a 48.06 per cent production interest in Mnazi and a 60.075 per cent exploration interest. It is also the operator of the concession.  Wentworth will have a 31.94 per cent production interest and a 39.925 per cent exploration interest. 

Additionally state backed group the Tanzania Petroleum Development Corporation (TPDC) owns a 20 per cent production interest in Mnazi.

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