Wentworth Provides Operational Update

Source: www.gulfoilandgas.com 6/17/2020, Location: Africa

Wentworth Resources, the independent, East Africa-focused natural gas company, is pleased to announce an operational update ahead of its Annual General Meeting ("AGM") to be held. As previously announced and in light of the COVID-19 pandemic, shareholders (other than the minimum number required to form a quorum, as arranged by the Company) will not be able to attend the AGM in person and have been invited to submit questions by email in advance.

HIGHLIGHTS

2020 Operations and Outlook
- The health and safety of our employees is the priority and robust precautionary measures have been put in place to ensure the continued safety of our staff; there have been no reported cases of COVID-19 at Mnazi Bay.
- Mnazi Bay remains fully operational, with 2020 production guidance remaining unchanged at 65-75 MMscf/day (gross).
- Average daily production from 1 January 2020 to 31 May 2020 of 58.2 MMscf/day (gross).
- Partnered with the Government of the United Republic of Tanzania ("Government of Tanzania") to provide PPE, medical supplies and equipment to hospitals in Mtwara and Dar es Salaam.
- The Government of Tanzania has re-opened business and travel within the country
- Gas volumes expected to increase in H2 2020 now that the rainy season has passed and COVID-19 restrictions in Tanzania have been lifted

Financial
- Debt free with $15.7 million cash on hand at end May 2020
- Dividend of $2 million declared on 24 April 2020 payable by the end of June 2020 , bringing a total distribution in respect of FY 2019 of US$3.0 million , representing an annual yield of 7.8% based on the closing share price of 16 June 2020
- Tanzania Petroleum Development Corporation ("TPDC") now fully current with payments as of end May 2020
- Tanzania Electric Supply Company ("TANESCO") expected to settle all remaining arrears

Sustainability
- Wentworth is committed to being a long-term partner for Tanzania and to deliver low-carbon, domestic energy supply growth that will underpin the socio-economic development of the country in the future
- As a responsible business, Wentworth recognises the importance of maintaining relationships with its stakeholders that are based on trust, respect and transparency
- Wentworth is committed to increasing its disclosure on its business impact to align with international best practice
- Work is underway to review Wentworth's current disclosure frameworks and it looks forward to updating all stakeholders on progress during H2 2020

Operations
Production over the period from 1 January to 31 May 2020 averaged 58.2 MMscf/day (gross). This period covers the traditional rainy season when hydroelectric power displaces natural gas-powered electricity generation, as well as the decreased industrial and consumer demand as a result of the temporary Government restrictions put in place to reduce the spread of COVID-19.

Demand in H2 2018 and H2 2019 was c.12% higher than H1 2018 and H1 2019, respectively. Given this historical context, the expected rebound in industrial customer demand from the lifting of COVID-19 restrictions, as well as the pick-up in volumes in June 2020 , management expects a significant increase in natural gas demand in H2 2020. With no operational disruptions due to COVID-19, the existing well stock at Mnazi Bay is strongly positioned to meet this expected surge in demand.

As previously announced, the Mnazi Bay JV Partners have agreed to a limited 2020 firm work programme totalling approximately $4.6 million net to Wentworth. This programme will ensure that Mnazi Bay maintains well integrity and is primed to support the growing in-country demand.

Financial
The Company continues to receive consistent monthly payments for gas sales with TPDC now fully current. The Mnazi Bay Partners are working with TANESCO to reach settlement of all outstanding arrears. As previously announced, the Company repaid its term loan in full on 31 January 2020 and is now debt-free. The Company's net cash balance at 31 May 2020 was $15.7 million . In accordance with the Company's sustainable dividend policy, established in 2019, Wentworth declared its second interim dividend for 2019 in April 2020 , which will be paid this month.

Sustainability
The power access gap in Tanzania is growing despite energy supply increasing, with a reported access rate of only 32.7%, leaving 7.7 million households without power. Transformational growth is needed in domestic energy supply to deliver the Government's target of universal access by 2030 through low-cost, low carbon solutions, aligned with the UN's Sustainable Development Goals.

Natural gas will play a critical role in meeting this target to support cheaper and more reliable electricity as well as facilitating an enabling environment for carbon-free renewable energy systems, such as hydro and solar. Wentworth is committed to being a long-term partner for Tanzania to deliver low-carbon, domestic energy supply growth that will underpin the socio-economic development of the country in the near and longer-term. This commitment underscores our approach to responsible and sustainable growth in Tanzania that creates shared value for all stakeholders.

Understanding our business impact on employees, host communities as well as society at large in Tanzania is critical to ensuring that our business operates responsibly and aligns with societal needs. The Company is undergoing a review to increase our disclosure on our business impacts that aligns with global goals and internationally recognised reporting frameworks. A further update will be provided during H2 2020.

Katherine Roe, Chief Executive of Wentworth, said:
"The health and safety of our workforce across our assets and offices is our priority and I'm grateful to the entire team for their dedication and hard-work to ensure that our business can continue to operate safely and seamlessly during this challenging time. As a result of their efforts, we have seen no impact on operational performance during the COVID-19 pandemic.

Despite these challenges and Tanzania-specific reduced demand due to above average rainfall, Wentworth continues to demonstrate business resilience with a strong balance sheet, and operational readiness and flexibility.

Emerging from this pandemic, it will be critical for businesses to be able to transparently demonstrate their impact on society as well as their resilience to these types of economic shocks in the future. We know that our business has a real opportunity to deliver significant, positive change for the people of Tanzania through gas to power and we are committed to increasing our disclosure on our business risks and impacts to align Wentworth with international best practice. The sustainability and ESG landscape is constantly evolving, meaning that this will be an ongoing journey for Wentworth and we look forward to updating you further on our progress later in the year.

In the second half of 2020, we expect to supply increased gas volumes now that the rainy season has passed and COVID-19 restrictions in Tanzania have been lifted. We look forward to building on this foundation and remain committed to being a leading player in Tanzania's energy growth and transition as it seeks to deliver universal access in the country by 2030."wn


United Kingdom >>  4/16/2021 - UK Oil & Gas Plc (UKOG), a UK and internationally focused energy company, is pleased to announce its full year results for the full year ended 30 Sept...
Colombia >>  4/15/2021 - Interoil Exploration and Production announced average gross operated production in March 2021 and corresponding numbers for February 2021. ...

Morocco >>  4/14/2021 - Europa Oil & Gas (Holdings) plc, the AIM traded Ireland, Morocco and UK focused oil and gas exploration, development and production company, announces...
Colombia >>  4/13/2021 - GeoPark Limited (“GeoPark”) (GPRK), a leading independent Latin American oil and gas explorer, operator and consolidator with operations and growth pl...

United States >>  4/13/2021 - Continental Resources, Inc. (CLR) provided an update on its first quarter 2021 production results. ...
Egypt >>  4/12/2021 - United Oil & Gas PLC ("UOG"), the growing oil and gas company with a portfolio of production, development, exploration and appraisal assets, offers a ...




Gulf Oil and Gas
Copyright © 2021 Universal Solutions All rights reserved. - Terms of Service - Privacy Policy.