If successful, the trial will translate into a long-term supply agreement that would see Kinetiko commence with the exploration, drilling and extraction of natural gas in South Africa, with FFS Energy producing and distributing the gas as LNG.
“This MoU describes a fundamental approach to our eventual large-scale production plans,” stated Nick de Blocq, CEO of Kinetiko, adding that, “FFS brings with them internationally-tried-and-tested midstream infrastructure for the production of LNG, as well as the ability to finance and operate the infield assets. Similar to our recent announcement of a letter of intent with Gruner Energy, we will be targeting the southern areas of our Block ER271 for this project due to deeper, higher pressured wells with optimum flow rates. This MoU is therefore the second in our plans to develop multiple joint ventures with expertise in the provision of midstream infrastructure, and with a focus on those who bring an existing market along with them in urgent need of high-quality gas.”
The companies are targeting the negotiation of a formal binding gas supply agreement within the next six months.