TIDMAEX
RNS Number : 7289D
Aminex PLC
30 June 2021
30 June 2021
FINAL RESULTS for year ended 31 december 2020 AND ANNUAL
REPORT
Aminex PLC ('Aminex' or the 'Company') is pleased to announce
its audited financial results for the year ended 31 December
2020.
Highlights
Outlook:
-- 3D seismic acquisition over 454 km(2) on the Ntorya location,
under the Ruvuma PSA, expected to commence third quarter of 2021
and continued progression of well planning activities for the
Chikumbi-1 exploration and appraisal well, for which Aminex is
fully carried under the terms of the Farm-Out Agreement
-- Chikumbi-1 drilling now planned for third quarter of 2022
awaiting results of 3D seismic to refine target location
-- Funding agreed with ARA Petroleum LLC for US$1.7 million to
assist with working capital requirements of the Group
-- Further gross administrative running cost reductions expected
for 2021 of 30%; gross general and administrative expenditure
(before one-off costs and exceptional items) anticipated to be less
than GBP1 million per annum by 2022, representing a 75% reduction
from 2018 levels
During 2020:
-- Completion of the Ruvuma PSA Farm-Out, securing US$5 million
of cash as consideration for transaction and US$35 million of carry
consideration for the advancement of the Ntorya Location gas
development
-- Company debt-free on the completion of the Ruvuma PSA Farm-Out
-- Reduction in Group administrative expenditure of 40% realised during the year
-- Loss for the year of US$6.14 million (2019: loss of US$15.23 million)
The Annual Report may be viewed on the Company's website
www.aminex-plc.com by clicking on the following link:
Aminex PLC Annual Report 2020
The Company will announce details of the Annual General Meeting
in due course, noting the UK and Irish Governments' respective
restrictions on public gatherings.
Paper copies of the Annual Report together with the Notice of
Annual General Meeting, including the Form of Proxy, will be mailed
shortly to those shareholders who have elected to receive paper
copies.
The Executive Chairman's Statement from the Annual Report
follows below:
Executive Chairman's Statement
Dear Shareholder,
We live in unprecedented and complex times. Although energy
prices have increased since their historic lows in April 2020,
COVID-19 continues to have a significant impact across the oil and
gas industry, forcing energy companies to review their strategy,
operations, in some instances retrench and, most importantly, cut
costs. The changes roiling the energy markets have impacted Aminex,
its value, and how it must position itself to maximise value for
its shareholders. These impacts have been particularly felt in
energy capital markets as the lack of clarity about the future has
dented investor confidence. Nonetheless, amid these global changes
and complex market pressures, Aminex has made significant progress
during 2020 including the successful completion of the Ruvuma
Farm-Out; the continuation of cost cutting initiatives and
consolidating its operations; the restructuring of the Board and
management to improve efficiency and focus; and the successful
migration to Euroclear Bank from CREST.
The Successful Completion of the Farm-Out
In October 2020, we saw the successful completion of the
long-awaited Ruvuma Farm-Out to ARA Petroleum Tanzania Limited
("APT"), a related party of the Group. This transaction should see
the Company entirely carried to material levels of production and
revenue without the need to return to shareholders for any
additional funding for the development of the Ntorya Location. The
Company now holds a 25% interest in the Ruvuma PSA with a US$35
million carry of its share of costs to potentially significant gas
production volumes. On completion of the Farm-Out the Company
repaid all of its debt and remains debt free. We believe this
non-operating position suits the Company's strategy to remain
flexible to opportunities whilst continuing to significantly reduce
costs. The Company sees this as a very real option for its other
assets which it believes will add shareholder value while
simultaneously reducing risk.
Ruvuma PSA development
APT assumed Operatorship of the Ruvuma PSA on completion of the
Farm-Out and at the end of 2020 presented to the Ruvuma Joint
Venture Partners ("Ruvuma JV") its roadmap to first gas. In the
near-term, it is APT's aim to shoot a 3D seismic survey over a
significant footprint of 454 km(2) , far in excess of the minimum
commitment, during 2021, following in 2022 with the drilling of the
Chikumbi-1 appraisal and exploration well. Although this results in
a delay to the drilling of Chikumbi-1, the JV is in agreement that
the 3D seismic is an essential tool for placing development wells
and helps determine project infrastructure requirements.
Accordingly, therefore this is the best course of action to ensure
the highest possible chance of success for the Ntorya development
and clearly demonstrates APT's commitment to the success of the
project.
The work programme and budget to the end of 2021 anticipates a
gross JV expenditure of approximately US$23 million, with Aminex
carried entirely for its 25% interest. We expect to see the
acquisition of the 3D seismic, prespud activities for the
Chikumbi-1 well, negotiations of the commercial terms for the
development licence, and the application for a further 1-year
licence extension. We are pleased to report that both ARA Petroleum
LLC ("ARA") and APT are aligned with the joint venture parties in
recognizing the value of our interest in Ruvuma and are focused on
seeing this project through to production.
Further Significant Cost Cutting and Consolidation
Following completion of the Ruvuma Farm-Out, Aminex has pivoted
towards a non-operating strategy. The Board believes that this
pivot will allow it to ultimately improve shareholder value. Having
successfully identified a farm-in partner on its key Ruvuma asset,
the Company continues to actively seek various options for its
other assets that will align with its strategy of reducing risk,
securing investment and reducing costs.
During the year, we continued to cut costs and reduce corporate
overheads, including reducing General and
Administrative costs ("G&A") while maintaining appropriate
capabilities and competencies, thereby building a more robust
de-risked business that would help create or attract strategic
opportunities.
In this period, we have conserved capital and reduced the impact
on shareholders, and I am happy to report that we have successfully
achieved significant gains in these areas. The Company intends to
reduce gross G&A costs by 30% from 2020 levels and an
additional 25-30% reduction in 2022. By 2022, these efforts will
reduce gross G&A expenditure (before one-off costs and
exceptional items) to less than GBP1 million per annum,
representing a 75% reduction from 2018 levels.
Board and Management Restructuring
In late January of this year, following the retirement of Robert
Ambrose as CEO, I became Executive Chairman of the Company. At the
same time, the Company reduced the number of Directors from five to
three. These changes reflect Aminex's continued effort to move from
a pure Operating Company to a flexible and leaner operation capable
of leveraging its near to mid-term production when global energy
markets recover and recognise the significant value of the
Company's carried asset. The streamlining of the Board reflects
this new approach, which we believe will ultimately secure and
increase shareholder value.
Aminex's focused and committed Board has the requisite skills to
source and assess future strategic partnerships, growth, and
consolidation opportunities as it transitions from operator to
non-operator. The streamlined Board is steadfastin preserving and
enhancing good corporate governance. These changes aim to shift the
Company from its operational perspective to that of a non-operating
partner, concentrating on initiatives that create value for the
Company.
Successful Migration Exercise
Although Brexit dictated the need for the migration of the
Company's share settlement system from CREST to Euroclear Bank, it
was a significant effort required to protect shareholders and
Aminex's public market listing.
Kiliwani North and Nyuni
The Company continues to explore the opportunity through
remedial work to restart production from our Kiliwani North well.
We, therefore, continue to see value in Kiliwani North through a
low-cost remedial work programme. However, no work can progress on
Kiliwani North until resolution is reached on the Kiliwani North
receivables. The Company continues to hold robust discussions with
the Tanzania Petroleum Development Corporation ("TPDC") in seeking
resolution of the outstanding payments for past gas sales from the
Kiliwani North development licence. Both parties are aligned in the
acknowledgement that these matters need to be resolved
satisfactorily for the benefit of the local gas industry and to
enable Tanzania to secure further investment and upstream gas
development.
Meanwhile, the Company, having applied for a 3-year extension of
the Nyuni Area PSA with a revised work programme in 2019, continues
to await a response from the Tanzanian authorities. The Nyuni Area
is proximate to the Kiliwani North licence and consequently in an
area of existing gas infrastructure. We see this as another
opportunity to reduce risk by pursuing a consolidation with another
operator in country or a farm-in partner to assist in the further
development upon Completion of the Farm-Out.
Outlook
With the Ruvuma Farm-Out concluded Aminex has no debt, with all
existing liabilities to ARA cleared. The Company continues to rely
on nearly US$2 million in payments due from ARA upon Completion of
the Farm-Out. Even with the COVID crisis, there remains a
significant and rising energy supply deficit in Tanzania, mainly
when considered against growing demand, highlighting the importance
of assets at different life cycles of their development like
Kiliwani North, Ntorya and Nyuni. We would also note to
shareholders that we are likely to be supplying gas domestically
and are therefore less directly impacted by global commodity price
weakness once in production.
We have seen positive signs that the Tanzanian Government is
working with producers in-country to support Tanzania's power
demands which outstrip the current supply. We, therefore, remain
highly optimistic about the future of this project and what it will
mean to the people and Government of Tanzania.
I remain optimistic about your Company's future as we have
valuable assets in Tanzania. We have the financing to advance the
Ntorya project and an outstanding partner in APT, which will help
drive real growth in-country. We believe that Tanzania's gas sector
is unlocking, with the Government working hard to deliver
prosperity for its citizens.
I would remind shareholders that we will be fully funded, as per
the terms of the Ruvuma Farm-Out Agreement, for these activities. I
want to thank shareholders for their continued support and all the
staff of Aminex and its subsidiaries. They continue to endure and
work hard on delivering value from our portfolio.
I look forward to providing further positive news on our
activities throughout 2021.
Yours sincerely,
Charles Santos
Executive Chairman
Ends
For further information:
Aminex PLC +44 20 3198 8415
Charles Santos, Executive Chairman
Davy +353 1 679 6363
Brian Garrahy
Camarco +44 20 3781 8331
Billy Clegg / James Crothers
/ Daniel Sherwen
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
FR FLFIRRTIIVIL
(END) Dow Jones Newswires
June 30, 2021 12:15 ET (16:15 GMT)
Aminex (LSE:AEX)
Graphique Historique de l'Action
De Nov 2024 à Déc 2024
Aminex (LSE:AEX)
Graphique Historique de l'Action
De Déc 2023 à Déc 2024
