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Wentworth Resources Limited, an independent East Africa-focused oil and gas company, has achieved Mnazi Bay gas sales revenue of US$10.79mn in H1 2018, up 112 per cent compared to H1 2017

This has been announced by the company’s half-year financial statements and management discussion and analysis (MD&A) ended on 30 June 2018.

Eskil Jersing, CEO of Wentworth, commented, “The first half of 2018 has seen Wentworth make material progress on Mnazi Bay Production growth, receipt of revenues and long term receivables, deleveraging of our balance sheet and redomicile of the Company to the UK. In particular, we have exited Q2 2018 with milestone production of 89 MMcf/d on Mnazi bay. Further, we have fully transitioned the Management team from Calgary to the UK and continue to make strides towards a simpler, cheaper, efficient and more robust platform for growth.”

Corporate

· Wentworth's share of Tanzanian Proved + Probable (2P) reserves valued at US$159.6mn (after-tax NPV10) on 2P reserves of 115.1 bscf, as on 31 December 2017 and independently verified by RPS

· Company continues to progress its Canada to the UK re-domicile and Oslo Bors delisting plans

· The UK-based management team in place following the relocation of corporate headquarters from Calgary, Canada to London, the UK.

Financial

· Improved EBITDA by 229 per cent to US$4.18mn compared to H1 2017

· Net loss of US$6.5mn including a non-cash deferred tax expense of US$8.68mn

· Cash and cash equivalents on hand of US$4.04mn as of 30 June 2018

· Working capital of US$15.45mn

· Reduced outstanding long-term loans by US$2.67mn during the first half of 2018

· Carrying value of long-term loans US$13.11mn

· Development capital expenditures of US$0.69mn on field infrastructure (tie-in) improvements in the Mnazi Bay Concession in Tanzania

· Exploration capital expenditures of US$0.98mn on the Tembo Appraisal License in Mozambique

· G&A expense of US$5.15mn including non-recurring expenses US$2.92mn and recurring G&A of US$2.23mn

· Non-recurring expenses includes, management re-structuring costs of US$0.83mn comprising Calgary employee severance and travel expenses related to corporate re-structuring, redomicile costs of US$0.34mn comprising consultancy, legal and professional charges and Tanzanian tax assessments of US$1.75mn for the years of 2013 to 2016

Operational

Tanzania

· Average gross daily gas production for the period increased 115 per cent to 79.3 mmscf per day from 36.9 mmscf per day in H1 2017

· Exited H1 2018 with a new high daily gas production rate of 89 mmscf per day

· Production ramp up due to Kinyerezi-I and Ubungo-II power stations operating at near full capacity, commissioning of the Kinyerezi-II gas-fired power station during Q4 2017, increasing growth in demand from Industrial customers and lower quantities of gas supplied by industry competitors;

· Low operating expense costs of US$0.43/ mscf leveraging increased production volumes

· Received total cash payments of US$12.97mn from gas sales and recovery of long-term government receivables during the first half of 2018

· Regular monthly payments for gas sales continue to be received. As of 30 June 2018, six invoices for gas sales to TPDC were outstanding, with the increase in receivables being accounted for by the increase in gas sales in the outstanding months. Post June 30, 2018, TPDC has paid three invoices.

Mozambique

· A 12-month extension of the Tembo Appraisal License was granted by Instituto Nacional de Petroleo (INP) on 16 June 16 2018

· During the first six months of 2018 above ground security continued to be a concern, especially in the Mocimboa da Praia and Palma regions. The Company continues to monitor the situation

· Wentworth continues to seek a risk-sharing partner, whilst in parallel advancing its technical studies, with a focus on commercial and monetisation options. Work continues on a subsurface review on materiality thresholds, reservoir properties and economic flow rate potential.