Swala Gets Nod from Tanzania's Energy Ministry to Farm Out Stake to India's Tata

Swala Energy has received a go ahead from Tanzanian authorities to farm-out its interests in the Kilosa-Kilombero and Pangani licences to Tata Petrodyne (TPL). 

“With the receipt of consents from the Tanzanian Petroleum Development Corporation, the Tanzanian Revenue Authority and now from the Ministry of Energy and Mines, the company is awaiting only the consent of the Fair Competition Commission (FCC),” Swala said in a statement Wednesday.

In June, Swala Energy announced the decision to farm out its stake to Tata Petrodyne, a subsidiary of India’s Tata Sons. 

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 in June.

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).