Solo Oil boosted by gas resource upgrade at African project

Solo Oil reported a resource upgrade in a gas field in Africa, boosting its shares by more than a third.

Solo said partner Aminex had updated its internal resource estimates in the southern part of the Ruvuma petroleum sharing contract (PSC) area, in which Solo holds a 25% interest, from mean initially in place gas of 2.3trn standard cubic feet (tcf) to 3.2 tcf.

Solo's executive director Neil Ritson said: "Ongoing work by the operator continues to reveal significant additional upside in the Ruvuma PSC using the 2014 seismic data. We remain excited about the potential developments in this area in the next few years where access to the 36-inch pipeline to the gas market in Dar es Salaam is nearly complete."

The study showed that, in addition to the previously announced target for an appraisal well in the Ntorya-Likonde appraisal area where 2.3 tcf mean gas initially in place was estimated, there was a further 900bn cubic feet of gas in the Namisange prospect to the west. Unrisked prospective resources of over 5 tcf are still under evaluation.

The Ruvuma PSC predominantly covers the onshore extension of the highly prolific basin in which multiple giant gas fields have been discovered offshore in both Tanzania and Mozambique.

Solo said: "The presence of condensate in Ntorya-1 well and oil shows seen in Likonde-1 well represent a further positive aspect of the onshore play, since liquid hydrocarbons add considerable further commercial value to the discovered gas and suggest the presence of a potential oil play."

Aminex and Solo are partners in the Ruvuma PSC, with respectively 75% and 25% interests. Aminex subsidiary Ndovu Resources operates the Ruvuma Production Sharing Agreement.

Shares in Solo rose 0.17p or 37.36% to 0.62p at 08:21 in London.