How is it doing
In early February, Solo told investors that it is continuing talks with ONE Dyas over a possible acquisition are continuing with a view to renegotiating terms to enable the deal to proceed.
In a statement, the junior oiler said that in support of the potential acquisition it continues to assess all debt and equity funding options available to the company.
Solo also said it continues to progress a number of complementary business development opportunities, in line with its European gas strategy.
Kiliwani North - Solo has an 8.4% stake in the Kiliwani North field which, in 2016, gave the company its first production generated revenue.
After around 2 years of operation, Kiliwani’s single well has just gone through an upgrade programme and is yet to come back onstream.
Ruvuma - Solo also owns 25% of Ruvuma, an expansive and high potential area in Tanzania that already hosts the Ntorya gas field development project.
Here, the asset development is set to be driven by The Zubair Corporation which is acquiring a 50% stake in Ruvuma via a farm-out transaction with current operator Aminex.
It will leave Aminex with 25% of the asset, the same as Solo.
Zubair plans to conduct a minimum work programme targeting a minimum gross rate of 40mln cubic feet of gas per day (MMcf/d) which amounts to 6,700 barrels equivalent.
It will also drill, complete and test a new well, Chikumbi-1 which will be a follow-up to the successful wells of at Ntorya.
The well will be located up-dip from both the Ntorya-1 and Ntorya-2 wells.
Pre-drilling operations for the Chikumbi-1 well are ongoing, as the Tanzanian government is actively working to complete the farm-out.
Solo reported a £652,000 loss for the six months ended 30 June and finished the period with £2.95mln.
What the boss says: new chief executive Tom Reynolds
“Based on the progress to date and the confidence we have in being able to add further production through both organic growth and also by further acquisition we believe we can grow the company to 20,000 barrels of oil per day within five years''”
“The portfolio of assets contains both producing assets, that generate cash flow, and also a backlog of development opportunities we can recycle that cash flow into and grow value for our shareholders.”
- Solo aims at establishing itself as a mid-cap E&P
- Operations at the Chikumbi-1 well are scheduled to start after the completion of the farm-out
- Shares are suspended while the acquisition of gas fields in the North Sea completes
Share Capital commented: “We maintain considerable confidence in Solo’s very ambitious strategy and (with our last published Risked NAV estimate standing at 3.5p/share) look forward to future newsflow, as the company pursues its objectives to build scale and provide important event-driven catalysts under its reinvigorated board.”