Wentworth Ramps up Tanzanian Power Plant Gas Sales

AIM-listed Wentworth is ramping up deliveries to the Mtwara power plant, Tanzania, it said January 13. In Q4 2015 its gross gas production into the pipeline and directly to a power plant in Mtwara averaged 46mn ft³/d, but it averaged 55mn ft³/d in December.

Under the gas sales agreement signed September 2014, the price is set at $3.00/mn Btu, rising in line with the US CPI industrial index, matching the Aminex deal in Tanzania.

Power sector demand is lower than it might be owing to delays commissioning the new Kinyerezi power plant and the conversion of the Ubungo power plant from diesel to gas, Wentworth said, but these plants are expected to become fully operational during Q1 2016.

The pipeline is now expected to carry between 70mn ft³/d and 80mn ft³/d in Q1 this year and thereafter remain consistent throughout 2016, with the potential for a further increase in volumes depending on demand.

The Mnazi Bay gas wells are expected to be more than capable of meeting expected demand so no new development wells are planned for 2016, Wentworth said. But the JV plans to align exploration activities in the Mnazi Bay concession with gas demand growth within Tanzania. Wentworth will update shareholders as plans progress.

Wentworth’s boss Geoff Bury said the company was in the “unique position” for a small E&P company to experience a growing cash balance on the back of higher gas production with no commodity price risk. He also said that the newly-elected government had shown its commitment to the future growth and development of Tanzania's power industry.

William Powell