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Kiliwani North update

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World Pipelines,

Aminex PLC is pleased to provide the following update on gas production from its Kiliwani North Development Licence in Tanzania.

Commissioning of the power generation system and other auxiliary facilities has been completed.

Commissioning of the gas plant and subsea pipeline commenced on 1 June 2016.

On 2 June, the first Kiliwani North-1 (KN-1) gas was processed and entered the pipeline system connecting the Songo plant with the national pipeline.

During the commissioning, gas rates are planned to increase to 30 million f3/d while pressuring up the plant and pipeline.

Aminex and its partners have invoiced TPDC for both April and May gas production in accordance with the terms of the signed Gas Sales Agreement.

As previously advised, all gas produced during the build-up to full production rates will be paid for under the terms of the agreed Gas Sales Agreement signed with the sole buyer, Tanzania Petroleum Development Corporation (TPDC). Aminex will receive US$3.00 per million BTU (approximately US$3.07 per million 3). The gas price is not linked to any commodity price so importantly is unaffected by current commodity market conditions. The gas delivery point is at the outlet flange of the Kiliwani North wellhead and, by selling the gas at the wellhead, the joint venture partners will not be liable for pipeline transportation and processing fees.

Initial production rates remain carefully managed to allow for testing and commissioning of the gas processing plant and pipeline, while recording critical pressure and flowrate measurements to determine the optimal flowrate to maximise the life of the reservoir. Together with TPDC the company plans to conduct a well test during the production build up to determine the optimal flow rate. It is this optimal flow rate that will become the Commercial Production Rate and the Company intends to flow gas at this rate for as long as possible prior to a natural decline in production. Based off initial pressure response from the Kiliwani North 1 well it is expected that the well will be tested closer 30 million ft3/d (approximately 4000 - 5000 boed gross).

KN-1 has booked contingent resources (2C) of 28 billion ft3 gross. Aminex expects to book reserves for Kiliwani North later this year.

Jay Bhattacherjee, CEO commented: “We are pleased with the progress made so far at Kiliwani. The well has been performing very well and commissioning is so far on schedule. The company continues to focus on delivering production growth through Kiliwani and driving its appraisal and eventual development programme at Ruvuma.”

Edited from source by Stephanie Roker

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