Aminex’s (LON:AEX) plans for the Kiliwani North gas project have been boosted by the Tanzanian authorities.
Talks over a gas sales agreement are currently ongoing between the company and the state-backed Tanzanian Petroleum Development Corporation (TPDC).
Aminex says the process is at an advanced stage and the talks are expected to conclude before the end of this year.
In the meantime the TPDC has decided it will build a pipeline to connect Kiliwani North to the gas network, via a new gas processing facility on Songo-Songo Island.
This will reduce the initial capital cost of starting up Kiliwani North, and will also save the company from ongoing maintenance costs.
As a result of the TPDC’s decision it is now anticipated that the produced gas will be sold at the well head.
Aminex also repeated its expectation that first commercial gas is expected in early 2015, after the TPDC told the company that the major pipeline project – to connect the region to Tanzania’s capital Dar es Salaam – is ‘approximately on schedule’.