TIDMWEN
RNS Number : 7021P
Wentworth Resources PLC
22 June 2022
22 June 2022
WENTWORTH RESOURCES PLC
("Wentworth" or the "Company")
Annual General Meeting
Operational Update: strong production underpins full year
guidance
Wentworth (AIM: WEN), the independent, Tanzania-focused natural
gas production company, is pleased to announce an operational
update ahead of its Annual General Meeting ("AGM") to be held
today.
Following record production achieved in 2021, Wentworth and its
joint venture partners continued to realize strong production rates
throughout 2022, recording an average production rate of 92 MMscf/d
year to date. The five producing wells in the Mnazi Bay field and
the associated joint venture operated facilities continued to
perform well and without issues. Furthermore, the reductions in
natural gas demand typically seen during the wetter months, April
and May, were less severe and shorter, compared to previous years.
The Company's production guidance for the year, provided in January
2022, remains unchanged at 75 - 85 MMscf/d.
The Government of Tanzania remains positive in their recent
announcements regarding their willingness to progress and promote
projects of national interest and it is expected that these
positive actions will continue to promote further growth potential
for the Tanzanian economy.
With the Company's recent agreement to acquire Scirocco Energy
plc's 25% interest in the Ruvuma PSA, Wentworth is pleased to
report that work on the 338 km(2) 3D seismic, over the discovery
and potential development area, is progressing positively and is
intended to provide data critical to the development of the field
and to optimize further drilling locations. The operator, ARA
Petroleum Tanzania, has indicated that the Chikumbi-1 well will be
drilled following the completion of the seismic programme and that
first gas from the project is possible by late 2024, following the
award of a 25-year development licence and construction of a
pipeline connecting the field to the Madimba gas processing
facility which is located within the Mnazi Bay licence area. The
Company looks forward to updating the market as operations on this
transformational new project progress.
O perational Highlights and Outlook
-- Average daily production year to date is 92.2 MMscf/day
(gross), compared with 79.9 MMscf/day (gross) during the same
period in 2021
-- Record quarterly average daily production of 98.5 MMscf/day (gross) achieved in Q1 2022
-- Wentworth and Mnazi Bay JV Partners supply approximately 50%
of natural gas demand in Tanzania which is primarily used for
essential baseload electricity but is also expanding to include a
multitude of industrial users
-- The Mnazi Bay JV Partners continue to progress the 2022 work
programme, which is focused on ensuring reliable gas production
through diligent field maintenance
-- The Operator will conduct essential maintenance during a
two-day shut down planned for late June
-- The health and safety of the employees at Mnazi Bay remains
of paramount importance as is evidenced with our continued efforts
to ensure robust health and safety standards. As of 31 May 2022,
the Mnazi Bay operations have reported zero lost time incidents for
a period of five years and 301 days
-- Evaluation of the Mnazi Bay licence area for additional
exploration and production potential is ongoing
Financial
-- Declared a final dividend in respect of FY 2021 of 1.16 pence
per share ($2.6 million); a total dividend distribution in respect
of 2021 of 1.7 pence per share ($4.0 million) representing an
increase from 2020 ($3.8 million) and a yield of approximately 7.1%
(based on current market capitalisation)
-- Debt free with cash on hand of $26 million
-- TPDC receivable $2.4 million representing 1-month of gas sales (fully current)
-- TANESCO receivable $753k representing 6-months of gas sales
($615k representing 5-months of gas sales in arrears)
Corporate
-- Actively progressing the Company's strategy to diversify the
asset portfolio with high quality growth opportunities as
demonstrated with the recent Ruvuma acquisition
-- Strict commitment to maintain sustainable progressive capital returns
-- Continued focus on growth within Tanzania and the broader
region by capitalising on a strong operational track record and
in-depth local knowledge
-- Maintenance of a highly skilled Board and management team
-- Progressively engaged with shareholders by providing regular updates and management access
Sustainability
-- In light of the COP26 conference in 2021, Tanzania announced
its commitment to reduce greenhouse gas emissions by 30% by 2030.
In doing so, the Government cemented its commitment to decreasing
its already-limited emissions output and reinforcing incentives for
low-carbon energy sources such as natural gas
-- Natural gas will play a critical role in meeting a reduction
in emissions with reliable baseload electricity helping to further
replace carbon-intensive off-grid fuel sources such as heavy fuel
oil and diesel
-- Ongoing ESG strategy remains a priority following the
publication of Wentworth's second Sustainability Report for 2021;
it addresses how Wentworth proactively manages its impacts by
upholding relevant international standards and adopting a
responsible approach to doing business in Tanzania; the Company is
progressing its initiatives with Vitol and the Government of
Tanzania on how to best address these goals
Katherine Roe, Chief Executive of Wentworth, said:
"I am delighted that Wentworth has made such a strong start to
the year with production, supporting our full year guidance and
providing the confidence to announce a further dividend increase
and maintain our attractive yield, one of the highest in the
independent E&P sector.
"Mnazi Bay continues to provide Tanzania with approximately half
of the country's natural gas demand and our contribution to the
country's growth will be further enhanced by our recently announced
acquisition of a 25% stake in the nearby Ruvuma gas development
project.
"Ruvuma is a transformational transaction for Wentworth and
represents an attractively priced, low risk entry into a high
growth opportunity which cements our position as a leading supplier
of domestic gas to Tanzania."
Ends
Enquiries:
Wentworth Resources Katherine Roe, katherine.roe@wentplc.com
Chief Executive Officer +44 (0) 7841 087 230
AIM Nominated Adviser and
Joint Broker
Callum Stewart
Stifel Nicolaus Europe Ashton Clanfield
Limited Simon Mensley +44 (0) 20 7710 7600
Joint Broker
Richard Crichton
Peel Hunt LLP Alexander Allen +44 (0) 20 7418 8900
FTI Consulting Communications Advisor wentworth@fticonsulting.com
Sara Powell +44 (0) 20 3727 1000
Ben Brewerton
Ollie Mills
About Wentworth Resources
Wentworth Resources plc (AIM: WEN) is a leading, domestic natural
gas producer in Tanzania with a core producing asset at Mnazi
Bay in the onshore Rovuma Basin in Southern Tanzania.
Inside Information
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Wentworth to constitute inside information as stipulated under the
Market Abuse Regulation (EU) no. 596/2014 ("MAR"). On the
publication of this announcement via a Regulatory Information
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END
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