Page 14 - AfrOil Week 11 2020

AfrOil
NEWS IN BRIEF
AfrOil
UPSTREAM
Sonatrach and Chevron
sign MoU on opportunities
in Algeria
Sonatrach and Chevron have signed a memo- randum of understanding to initiate joint dis- cussions on the opportunities concerning the exploration, development and exploitation of hydrocarbons in Algeria in particular following the promulgation of the new Algerian Hydrocar- bons Law.
This memorandum of understanding con- firms the will of the two parties to develop their partnership in the hydrocarbon industry in Algeria, which should allow mastery and trans- fer of technology and know-how in various seg- ments of the oil and gas industry.
Sonatrach, March 16 2020
Tower Resources
announces Cameroon
Reserves Report update
Tower Resources has received an updated inde- pendent Reserves Report from Oilfield Inter- national Ltd (OIL) on behalf of the Company’s wholly owned subsidiary, Tower Resources Cameroon, covering its Thali production-shar- ing contract offshore Cameroon. The 2020 Reserves Report, which conforms to SPE PRMS guidelines, does not contain new technical infor- mation compared with the previous report pre- pared by OIL and announced by the Company on November 1, 2018, but the 2020 Reserves Report reflects updated prices and costs reflect- ing the changes in the market over the interven- ing 16 months or so.
The 2020 Reserves Report, like the company’s 2018 Reserves Report, has quantified contingent and prospective resources across multiple fault block prospects on the Thali licence, includ- ing the existing oil discovery at Njonji in the southern part of the licence area, together with their calculated Net Present Value (NPV) and Expected Monetary Value (EMV), as detailed below.
The NPVs and EMVs have been calculated based on two price sets: a standard North Ameri- can forecast methodology using a February 2020 forecast price for 2021 and a constant money price escalation of 2% per annum (the Sproule Energy Forecast) in order to provide compara- bility with other reports on other assets using this type of methodology; and the actual Brent Forward Curve at close of business on March 10, 2020, which is the primary focus of this 2020
Reserves Report, to illustrate the impact of the recent fall in oil prices, and to confirm the eco- nomic viability of the contingent resources in the current lower price environment.
2020 Reserves Report highlights: gross mean contingent resources of 18mn barrels of oil across the proven Njonji-1 and Njonji-2 fault blocks (with low/best/high estimates of 5/15/34mn barrels) are unchanged, with a development contingency probability of 80% on first phase and 70% on second phase; gross mean prospec- tive resources of 20mn barrels of oil across the Njonji South and Njonji South-West fault blocks (with low/best/high estimates of 5/16/39mn barrels) are also unchanged; gross mean pro- spective resources of 111mn barrels of oil across four identified prospects located in the Dissoni South and Idenao areas in the northern part of the Thali licence (with low/best/high estimates of 21/84/237mn barrels) are also unchanged; the NPV10 of the Best Estimate of Contingent Resources using the Sproule Energy Forecast is $179mn, with an EMV10 of $143mn, but it should be noted that these figures are based on a February 29th forecast based on a 2021 Brent price of $68/barrel; the NPV10 of the Best Esti- mate of Contingent Resources using the March 10, 2020, Brent Forward Curve is $119mn, with an EMV10 of $91mn – these figures com- pare with the 2018 Reserves Report NPV10 of the Best Estimate of Contingent Resources of $158mn and an EMV10 of $118mn using the then-current Brent Forward Curve at a time when the 2019 forward Brent price was over $71 per barrel.
Jeremy Asher, Chairman and CEO, com- mented: “We are pleased to present this updated 2020 Reserves Report on the Thali licence in Cameroon. I already observed last year that our project economics were attractive across a wide range of oil price scenarios, and in September last year I presented one of our internal cash flow forecasts showing the very attractive cash generation from the project assuming a flat $40 per barrel Brent price, which can be still be found
in our September 2019 corporate presentation on our website. The 2020 Reserves Report con- firms the attractiveness of the Njonji project economics.
“It is also worth noting that the riskier pro- spective resources on Thali can be tested at very low cost during the process of developing the contingent resources already discovered. In particular, the Phase 1 development process at Njonji will also test the Njonji South Pro- spective Resources of 18mn barrels (Pmean), which would be additional to the 18mn barrels (Pmean) of existing contingent resources already discovered at Njonji, thus providing a natural additional upside to the project which is not reflected in the NPVs and EMV10 of the contin- gent resources.
“So even in the lower oil price environment in which we now find ourselves, which echoes the price environment at the end of 2015 shortly after we first entered the Thali license, the Thali license is an attractive asset which we expect will earn excellent returns.”
Tower Resources, March 13 2020
SERVICES
Air Products technology
selected for Mozambique’s
first onshore LNG project
Air Products, the world’s leader in liquefied nat- ural gas (LNG) technology and equipment, has signed an agreement to provide its proprietary LNG technology, equipment and related process licence and advisory services to the Mozambique LNG Project. Air Products’ world-leading LNG manufacturing facility in Port Manatee, Flor- ida, will manufacture two LNG heat exchang- ers, which will then be shipped to the project site on the Afungi Peninsula in Cabo Delgado, Mozambique.
P14
w w w . N E W S B A S E . c o m
Week 11 18•March•2020