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.
Wentworth Resources (LON:WRL) this morning confirmed some of details regarding its acquisition of Cove Energy’s (LON:COV) stake in the Mnazi Bay concession, in Tanzania.
On Monday it was revealed that Shell had emerged as the recommended bidder for Cove, and the group’s formal sales process came to an end.
Previously Wentworth agreed a deal to acquire Cove’s stake in the Mnazi Bay venture. Shortly after fellow JV partner Maurel et Prom said it would also participate in the deal, by exercising a pre-emption right.
Today Wentworth confirmed that following government approval it will now acquire Cove Energy Tanzania Mnazi Bay Ltd, a subsidiary that holds Cove’s stake in the venture. And subsequently it says it will transfer 60.075 per cent of the equity to M&P.
In return M&P will pay Wentworth US$18.9 million. And the two partners have agreed that on closing their respective pre-emption rights will be satisfied.
“We continue to work with our partners, M&P and TPDC, to further the exploration and development of the Mnazi Bay Concession,” said Wentworth chairman Bob McBean.
“In anticipation of completion of the Mtwara to Dar es Salaam pipeline, negotiations of a gas sales agreement are underway, workovers of three existing gas wells will soon commence and the partners are planning exploration activities following the completion of the workovers.
“These activities are designed to increase our resource base and position Wentworth to become a significant gas producer in Tanzania."
In terms of development and production Wentworth will have a 31.94 per cent stake in Mnazi Bay and the project operator M&P will own 48.06 per cent. Meanwhile Tanzania’s state oil firm, TPDC, retains its 20 per cent interest.
And M&P and Wentworth will respectively own 60.075 per cent and 39.925 per cent in exploration aspect of the venture.
Cove Energy receives 2 million new shares in Wentworth Resources and it may be due US$8.5 million subject to future natural gas production milestones.
As part of the deal Wentworth is also terminating its 4.95 per cent production royalty over Cove’s interest in the offshore LNG project in Mozambique.