Swala Energy to Sell Stake in Tanzania Licences to India's Tata Petrodyne

Swala Energy has announced farm out of its Tanzania licences to subsidiary India’s Tata Sons.

Swala Oil and Gas (Tanzania) has reached agreement with Tata Petrodyne (TPL), a subsidiary of the multinational Tata Sons Limited, under which TPL shall farm into the Pangani and Kilosa-Kilombero licences in Tanzania. Swala owns 58.5 percent of Swala Tanzania.

TPL will pay Swala Tanzania the sum of $5.7 million for a 25 percent equity interest in the Kilosa-Kilombero licence and a 25 percent equity interest in the Pangani licence as consideration towards the past costs incurred on the licences, Swala Energy said.

TPL will free carry Swala Tanzania through the costs of the initial well on the Kilosa-Kilombero licence, up to a maximum of $2.5 million and will free carry Swala Tanzania through the costs of the initial well on the Pangani licence, up to a maximum of $2.125 million.

On completion of the farm-out, the equity interest in the two licences will be: Swala (25 percent), TPL (25 percent) and Otto Energy (50 percent).