I should add my thoughts on the matter rather than just state...

I should add my thoughts on the matter rather than just state that I'm sure KEY have considered (or are considering) increasing their stake in the Nyuni block.

As I understand it from a previous presentation by KEY, the cost to them for drilling another well in the Nyuni block would be about A$8m based on the current exchange rate (source quote US$).

A share placement at current prices would struggle to raise A$5.6m under resolution 4 that was put to the vote at the AGM on November 23rd and that option expires on 23/2/10.

The rest could be raised from cashflow from the Lidsey oil field if oil prices stay high and the Lidsey #2Hz is at least moderately successful. If KEY hit or exceed the top end projection then that would give them enough and change.

The negative side, it's already taken ages to get to this point with negotiations with the Tz government & other parties. Why increase exposure to Tz when cashflow has been so long in coming?

The plus side, we know the area is highly prospective, there is a clear and growing need for gas/energy in Tz, they have had years of energy shortfalls resulting in annual blackouts at worst, brownouts at best. In a country of something like 40m people only about 14% are connected to the electricity grid (going on memory of various articles I've read in the past year so I might be out slightly with those figures).

The unknown (to us plebs), just how big is the KN#1 field, exactly how prospective are the other targets in the Nyuni block and are they accessable from islands or reefs in the area, and of course the important one for cashflow, how close is commercialisation?

If further resources are identified/drilled then the case improves for alternatives to the Songas plant which gives greater negotiating power to the JV partners.

The KEY (pun intended) dates in the near future for Tz from KEY's perspective are the expiry of the placement option on 23/2/10, the Oil & Gas Africa 2010 Conference from 16/3/10 to 18/3/10, the drilling of Lidsey #2Hz (for the sake of potential increase in cashflow) in March/April 2010, and the release of the siesmic results for the KN#1 field due by the end of March 2010.