Aminex Share Discussion Threads

[ngms27] 28/2/2017 15:48

haggis two points:
1) We don't yet know what the size nor productivity of NT-2 are
2) Power Stations take years to design and build

[haggismchaggis] 28/2/2017 15:45

lowflow, but if you understood it you would know that Tanzania couldn't expand power generation until gas was available. It's only since the pipeline has been built that Tanzania is able to progress it's power expansion plans. N2 having high production and huge capacity is an enabler.

[ngms27] 28/2/2017 15:37

tidy 2, the offshore gas is for LNG export, that's been official Government policy for ages. The onshore gas is deemed for local demand.

My view is that it's chicken and egg. If Aminex prove vast quantities of gas then the demand will follow in the 2020's through power, fertiliser, plastics and other petro chemical plants.

[m0rrisminor] 28/2/2017 15:35

Ho yes Kibo are building i will get back and cross reference with the person who told me this.

[tidy 2] 28/2/2017 15:29

Is that why the big guns are buying up all the reserves.

[lowflow] 28/2/2017 15:21

Tanzania increased demand in natural gas has been an illusion for the past years and it will most likely continue to be an illusion for a number of years until Tanzania will sort out several issues surrounding domestic natural gas sales and power generation.

Tanzania Ministry of Energy and Minerals has published two very extensive reports on the long-term plan for power generations, "Ministry of Energy and Minerals "POWER SYSTEM MASTER PLAN 2012 UPDATE" (hxxp://www.tanesco.co.tz/index.php/investments/investment-report/22-power-system-master-plan-2012-update/file) and "POWER SYSTEM MASTER PLAN 2016 UPDATE" (hxxps://mem.go.tz/wp-content/uploads/2017/02/Power-System-Master-Plan-PSMP-2016-Update.pdf)

There are several interesting point in these reported if you read them in detail.
I think the most important point is that the growth in power demand and natural gas has been nowhere what the Tanzania Government expected.
First look at the expected power demand in the 2012 report, page 30.
"Gross Generation GWh" 2010: 5653 GWh, 2011: 5908 GWh, 2012: 6085 GWh, 2013: 7332 GWh, 2014: 9200 GWh, 2015: 11246 GWh, 2016: 13520 GWh.

Then have a look at the power demand forecast in the 2016 report, page 11. 2015: 6310 GWh, 2016: 7820 GWh, 2017: 8970 GWh.

When you then compare the 2012 forecast to the actual power demand you can see that in 2012 they expected demand in 2015 and 2016 to be 11246 GWh and 13520 Gwh. But it turned out to only be 6310 Gwh in 2015 and est 7820 Gwh in 2016. The actual demand was 44% lower in 2015 compare to the long-term plan and 42% lower in 2016.

What is more interesting is that power demand in Tanzania only grow from 6085 GWh in 2012 to 6310 Gwh in 2015, which is only 3.7% growth in three years which is basically nothing.

Both Solo and Aminex is referring to the "POWER SYSTEM MASTER PLAN 2012 UPDATE" in their investor presentation which is indeed bogus considering that the Tanzania Government has lowered the gas and power demand outlook considerably in the 2016 report compared to the 2012 report Solo is referring to in their last investor presentation on page 11 (hxxp://www.solooil.co.uk/~/media/Files/S/Solo-Oil/reports-and-presentations/2016/solo-oil-fp-east-africa-feb-2017.pdf)

Than I would suggest that you have a look at page 64 in the 2016 "POWER SYSTEM MASTER PLAN 2016 UPDATE" where they outline the expansion of power generation capacity and natural gas power generation capacity. You can read there that only two natural gas power plants are currently sanctioned and under construction, namely “Kinyerezi I Extension” and “Kinyerezi II” adding 185 and 240 MW in 2017. Which will most likely be fueled with gas from Orca and Wentworth/Maurel who already have available capacity.
The bottom line is the following:
- Power demand in Tanzania has not been growing rapidly as Aminex/Solo trying to give the impression of.
- Aminex and Solo is referring to a power and natural gas outlook from 2012 while there is updated forecast from 2016 which are considerably lower compared to the number Solo and Aminex are presenting.
- Only 2 natural gas power plans is currently under construction, and these plants can easily be supplied by existing natural gas production capacity.
- It will be very difficult to monetize additional gas for Aminex/Solo in the next few years as the market is well supplied.

[tidy 2] 28/2/2017 15:11

And a 25 year production development license.

[tidy 2] 28/2/2017 15:11

To warrant the expense of the spur.

[blackgold00] 28/2/2017 15:06

ngms, 20p LOL.

"However if they followed my idea of raising cash to drill Sudi and Namisange before license expiry in December then it would indeed be possible for XMAS."

and then what ngms, have any new discovery just sat there undeveloped waiting for demand to catch up, until when 2030?

[tidy 2] 28/2/2017 15:00

They will concentrate on Ntorya as it is big enough to produce. If it wasn't so big they would be waiting for N3. Production testing now. The clues are there if you look hard enough.

[ngms27] 28/2/2017 14:57

20p LOL.

However if they followed my idea of raising cash to drill Sudi and Namisange before license expiry in December then it would indeed be possible for XMAS.

[ngms27] 28/2/2017 14:52

Greatful Dead, empirical evidence in Tanzania is on my side. Thats why I'm taking this stance.

[haggismchaggis] 28/2/2017 14:50

ngms, ever seen one of these? They can be in and running in several weeks. They can be procured on any length of hire or lease. Not all new power has to come from a huge power station, industrial users can add their own gas chp generators on site.http://www.ekotech.co.ukhttp://www.abelenergy.co.uk/gas-chp/

[ngms27] 28/2/2017 14:49

Of course they are going to test to see what they think the well can deliver if put on production, that would be normal if you are going to the expense of testing.

However I still maintain that any production from Ntotya will be limited by demand until the 2020's rather than the well capability as there is still lots of potential behind pipe with Orca, M&P/Wentworth and good old KN-1

The demand will come but it's not anywhere near yet.

[greatfull dead] 28/2/2017 14:48

ngms27,

You would be very surprised how gas fire power station construction can be fast tracked these days and safely too.

I worked in the Oil and Gas construction Industry for many years of my working life and have seen projects being fast tracked that it blew away things. Believe me it can be done with the correct approach and highly educated, very motivated and highly skilled engineers.

ATB,
GD

[tidy 2] 28/2/2017 14:24

Bomb back on the bus is it ngm lmao !!

[ngms27] 28/2/2017 14:07

They can fast track all they like, but you don't build power stations in less than three years from the go ahead

[tidy 2] 28/2/2017 14:00

Of course. Ntorya can be online in a matter of months.

[haggismchaggis] 28/2/2017 13:49

Tanzania wants huge growth over the next 5 years, the only way to fuel it, literally, is with the onshore gas. If N2 comes up big and highly productive, Tanzania will fast-track more power plants and gas based industrialisation. The Chinese will be brought in to help again.

[edgar222] 28/2/2017 13:42

Tidy

I agree with a lot of what you say but the offshore LNG does NOT go online in 2018.

They have not started building it yet and it takes years and costs billions.

Better for us of course !

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[ngms27] 28/2/2017 13:37

Not even got FID yet, even if FID this year first LNG would be 2023 at the earliest