Wentworth set with new funds

Set up: Like the flamingoes at Lake Natron in Tanzania, Wentworth Resources is sitting pretty.

Incoming funds mean UK-listed Wentworth Resources is sitting pretty for 2012, it said in a statement to the London Stock Exchange.

In its end of year statement, Wentworth said it had a cash balance of $9.1 million and working capital of $4.2 million at 31 December 2011.

Since then, the company had received almost all of the $13.5 million it was owed for the sale of its 18MW gas-fired power plant to Tanzania Electric Supply Company.

Furthermore, Wentworth is owed about $19 million after France’s Maurel & Prom exercised a pre-emptive right to increase its stake in the Mnazi Bay concession.

M&P exercised the right after Wentworth acquired Cove Energy’s 16.4% stake in Mnazi production operations after terminating its 4.9% net profits interest in Cove’s Offshore Rovuma Area 1 concession.

As payment for the move, M&P will pay Wentworth about $19 million and up to a further $5.1 million in contingent considerations should certain natural gas production thresholds be reached.

This will give Wentworth a 31.94% participation interest in petroleum operations (39.925% participation interest in exploration operations) in the Mnazi Bay concession.

Wentworth will pay about 12% of the drilling costs of the Ziwani-1 well on the prospect and the second exploration or appraisal well planned for the block.

A further three wells on Mnazi Bay are planned to be worked over once that drilling programme is finished, with partners in the Mozambique onshore Rovuma basin project planning to start seismic exploration in the second quarter.

Company managing director Geoff Bury said the company was fully funded to meet its 2012 capital and operating budget.

“We expect to exit the year with a positive cash position,” he said in a statement.

This came after Wentworth generated a 2011 end of year loss, despite a revenue boost brought on by provision of electricity to new parts of Tanzania.

But the company did have a significant improvement on the previous year, after gains on derivative financial liability and financing costs pushed its 2011 loss down to $6.2 million, from the 2010 loss of $23.3 million.

In its announcement, Wentworth said it had recorded total revenue of $7.7 million in 2011, of which $7 million was from sales of power, following the electrification of Tanzania’s Masasi district.

But revenue from the company’s natural gas arm had also increased, to $691,000, up from $601,000 the year before.

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