Maurel et Prom has agreed to sell a 20% stake in its Mnazi Bay asset to state-owned Tanzania Petroleum Development Corp. (TPDC).
Maurel agreed to buy Wentworth, and its 31.94% stake in Mnazi Bay, in December 2022. At the time, Wentworth said it expected the deal to close in the second quarter of 2023.
The buyer has now struck a deal with TPDC that seems to solve the problems. It has provided a call option to TPDC, allowing the Tanzanian company to buy a 20% stake in the asset after closing.
As a result, Maurel would have 60% in Mnazi Bay and TPDC 40%.
Maurel CEO Olivier de Langavant welcomed the “partnership with TPDC that will reinforce the basis for the mutual benefit of the next phase of development at Mnazi Bay”. The next phase will “bring about the continued growth and development of Tanzania’s natural gas sector”.
The company said that, as part of the call, it has received its pre-emption waiver from TPDC and the Tanzanian government.
Closing in
A Jersey court will hear the plan on December 19 and, presumably, approve it. Following this, Maurel will take ownership of Wentworth. The proposed timetable would see the scheme take effect as of December 21. The plan has a long stop date of December 31.
In June this year, Wentworth warned that TPDC had raised objections to the sale and raising the prospect of using its right of first refusal. The seller took the position that TPDC had the right only to pre-empt a sale of equity in an asset, rather than through the sale of shares in Wentworth itself.
Maurel, in its third quarter results, said Mnazi Bay was producing 113.5 million cubic feet per day, up 15%. However, the companies exhausted their recoverable cost allowance in June this year, which increased the tax on production. Now, Maurel said, most of its production is classified as profit gas with the state taking a 70% share.