Page 19 - AfrOil Week 35

AfrOil NEWS IN BRIEF AfrOil

Financial Highlights: Record quarterly produc-
tion levels since 2013; third straight quarter of
production increases to approximately 2,347
bpd net for Q2-2020; gross revenue excluding
hedging income from continuing operations1
of $8.5mn for the first six months of 2020 from
three international oil liftings; operating cost
of under $15 per barrel of oil produced for the
six months to June 30, 2020; positive EBITDA
and Operating Cash Flow (including hedges)
in Q2-2020 and H1-2020, despite very low oil
price and higher operating costs linked to work-
overs in Tunisia; net income after tax for the six
months to 30 June 2020 of $3.4mn, principally
from realised and unrealised gains on crude
oil hedges of $9.2mn; capital expenditure of
$9.1mn year to date ($4.1mn for the second
quarter), largely completing planned spending
for 2020; cash balances of $19mn at June 30, 2020
(March 31, 2020: $24.2mn), including cash held
for bank guarantee; receivables from crude oil
sales were $4.3mn at June 30, 2020 (March 31, during H1-2021; production growth activity Prospecting Licence 276 from Newcross Petro-
2020: $3.1mn), with $2.7mn of these collected in Tunisia at unprecedented levels; dividend of leum (subject to receipt of required consents);
subsequent to quarter-end; debt of $22.8mn (31 PetroNor shares to Panoro shareholders upon preliminary resource estimates by Newcross,
March 2020: $23.4mn), with $2.9mn having completion of sale of Aje. based on four wells resulting in four discover-
been repaid in the first half, followed by a further Panoro Energy August 27 2020 ies, reported gross recoverable volumes of 29mn
$700,000 repayment in July. barrels of oil and 333 bcf (9.43 bcm) of gas,
Operational Highlights; production and lift- LEKOIL announces final upside of 33mn barrels of oil and 476 bcf (13.48
ing operations maintained and largely unaffected bcm) of gas (recoverable).
through crisis; Health and Safety systems and results for FY 2019 Operational Highlights, OPL 325: Execution
protocols proved resilient; in Gabon, quarterly of the PSC in relation to the Oil Prospecting
production at record high of 15,991 bpd gross AIM-listed LEKOIL, the oil and gas exploration Licence 325 expected to occur in 2020; on exe-
on average, with current production in excess and production company with a focus on Nigeria cuting the PSC, LEKOIL intends to farm-down
of 18,000 bpd;; at Dussafu, seismic reprocess- and West Africa, has announced its final audited a portion of interest following a detailed prospect
ing completed, potential for material increase results for the year to December 31, 2019. and lead risking study.
in hydrocarbon volumes at Hibiscus; Tunisian Operational Highlights, Otakikpo: pro- Financial Highlights: Equity crude sales
quarterly production of 3,903 bpd gross on aver- duction levels averaged approximately gross proceeds of $42.0mn; total production from
age, with periods of production at 4,300 bpd; in 5,305 bpd (2,122 bpd net to LEKOIL Nigeria); the Otakikpo marginal field for the year at
Tunisia, operational constraints imposed by the Updated Competent Person’s Reports announc- 759,666 barrels net to LEKOIL Nigeria; the
COVID-19 pandemic gradually began to be ing a significant upgrade to 2P oil reserves esti- Group lifted 677,788 barrels for the year 2019,
released in the latter part of May, though inter- mates and prospective resources (unrisked) for realising an average sales price of approximately
national travel restrictions still apply; workover LEKOIL Nigeria’s working interest in the field; $62 per barrel; loss for the year of $12.0mn
activities recommenced in June with multiple Field Licence renewed; Phase Two plans under- (2018: loss of $7.8mn); cash and bank balances
wells currently being prepared for production; way, subject to the securing of funding, for a five of $2.7mn as at December 31, 2019 (Decem-
Guebiba 10 side- track spud in August with rig to seven well drilling programme, targeting the ber 31, 2018: $10.4mn); cash balance at July
CTF 06, targeting undrained oil in a location increase of production to around gross 15,000- 31, 2020 of $600,000; as at December 31, 2019,
close to the crest of the field. 20,000 bpd (6,000-8,000 bpd net to LEKOIL total outstanding debt financing, net of cash,
Corporate Highlights: hedging strategy Nigeria): was $16.5mn (December 31, 2018: $10.1mn);
proving effective in period of extremely volatile Operational Highlights, OPL 310: Advanced target an immediate reduction of at least 40% in
and low oil prices, realising $2.7mn in finance plans for the Ogo appraisal drilling programme general and administrative expenses annually
income during H1-2020; three non-executive with well locations selected; funding discussions following the significant drop in oil prices in the
directors purchased shares during the quarter. currently underway with industry partners; first half of 2020.
Outlook and Guidance: two international LEKOIL executed a legally binding Cost and Lekan Akinyanmi, LEKOIL’s CEO, com-
liftings (one of each Tunisia and Gabon) for Revenue Sharing Agreement (CRSA) to pro- mented: “The priority for 2020 is to advance
Q3-2020; three liftings expected in Q4-2020 gress the appraisal and development programme towards the start of the drilling programmes at
(two Gabon, one Tunisia); hedging position activities at the OGO discovery and conversion both Otakikpo and Ogo in OPL 310. The next
remains strong at approximately 25% of pro- to an Oil Mining Licence (OML); OPL 310 two years will prove to be transformative and
duction hedged until end 2021 at $55 per barrel; Licence extended to August 2, 2022, following provide key catalysts for value appreciation for
2020 net production guidance of 2,300-2,500 the payment of an extension fee by LEKOIL. shareholders through the drill bit as we advance
bpd; in Gabon, production from DTM-6H Operational Highlights, OPL 276: Acquired in building a leading Africa-focused exploration
(drilled but not tied in) and DTM-7H (to be 45% participating interest in the Production and production business.”
drilled) to be brought into production likely Sharing Contract (PSC) in relation to the Oil LEKOIL, August 26 2020

Week 35 02•September•2020 www. NEWSBASE .com P19