Swala Energy is a hot potato

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DAR ES SALAAM, Tanzania ¿ The Initial Public Offer (IPO) of Swala Oil and Gas Tanzania Plc has attracted over 100 new investors, who have applied just a few days of the offer.

Swala opened its IPO on the 9th of June this year which has received significant interest from within Tanzania, the East African Community and overseas. 

Swala¿s Chief Executive Officer, Dr David Mestres Ridge told East African Business Week in Dar es Salaam last week that we know people keenly following our progress and how Tanzania responds to this first oil and gas listing. 

¿The interest in Swala¿s IPO is extremely positive, with over 100 new investors applying for shares within the first few days of the offer,¿ Ridge answered.

Swala has offloaded 9.6 million ordinary shares to Tanzanians at a price of Tsh500 ($0.297) per share to raise up to Tsh4.8 billion ($2.85 million). This amount is before costs and expenses.

The official launch of Swala¿s IPO comes following its official approval from the Tanzania Capital Markets and Securities Authority (CMSA), making it the first of such offering in the oil and gas industry in East Africa.

¿Investing in oil and gas shares is means for economic diversification for any individual and it allows interested parties to own a stake in a fast growing business,¿ the CEO said.

He added they are grateful to the government of Tanzania, Tanzania Petroleum Development Corporation (TPDC) and the CMSA for allowing them to become East Africa¿s first public owned oil and gas company.

The offer opened from 9th June and will be closed on 4th July 2014. Currently there is no maximum subscription limit, but a minimum subscription of 100 shares per person is required.

Swala is committed to entering the second-year exploration phase of the initial exploration term in both its Pangani and Kilosa-Kilombero Production Sharing Agreement (PSA) licence areas, together with its Joint Venture partner Otto Energy, a wholly-owned subsidiary of Otto Energy Ltd.

Swala¿s decision to proceed into years 3 and 4 in both licence areas was supported by the encouraging results observed following interpretation of Swala¿s 2012 airborne gravity and magnetic survey that was followed by the highly successful 2D seismic campaign undertaken during 2013, where 5 significant prospective hydrocarbon basins were investigated by the acquisition of 563km of data.

Swala is an affiliated company to Swala Energy Limited, a company in turn listed on the Australian Stock Exchange (ASX) with ticker ¿SWE¿. It holds assets in the world-class East African Rift System with a total net land package in excess of 17,500km2. 

New discoveries have been announced by industry participants in a number of licences along this trend, including Ngamia and Twigga, which extend the multi-billion barrel Albert Graben play so successfully developed by Tullow Oil into the eastern arm of the rift. 

Swala has an active operational and business development programme to continue to grow its presence in the hydrocarbon provinces of East Africa.

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