Page 19 - AfrOil Week 26

AfrOil NEWS IN BRIEF AfrOil

To date, the Company has received just over
$190mn in total loan notes payments.
A further $41.5mn was received to date
in 2020, with an expected $10mn to come in
Q4-2020. A further $103.9mn (approximately)
expected in interest and loan note repayments
by end-2021. In January 2019, the Company
reported the restructuring of the Reserves Based
Lending (RBL) facility held by Eroton, which
frees up near‐term cash resources for operations.
Cash balance was at $36.5mn as at June 19, 2020.
Loss for the financial year of $38.6mn was pre-
dominantly associated with non-cash items such
as Impairment of non-core assets (Barryroe).
Oisin Fanning, CEO, commented: “San Leon
is in a strong position, currently sitting with
$36.5mn in cash on our balance sheet. The cur-
rent environment generates challenges which attributable to OML 18 in 2019 were lower than the Abu Sennan concession for the first half of
Eroton is addressing well, but at the same time 2018 (22% in 2019 versus 26% in 2018). This was June - a 69% increase compared to average April
it provides a huge opportunity for our Company largely due to the installation of LACT units on production (1,810 boepd net); total produc-
to initiate its next stage of growth. We have the most of its production. The higher downtime in tion during that period has benefited from the
cash resources, technical and managerial capa- 2019 (24% compared with 12% in 2018) reflects ongoing testing of the El Salmiya-5 Well, with
bility, and established relations to select our next a particularly challenging performance from circa 4,000 bpd and in excess of 16mn cubic feet
projects. NCTL, highlighting the need for an alternative. per day (7,200 boepd) contribution from the El
“OML 18 remains a world-class asset and the “The most positive impact on OML 18 oil Salmiya Field.
activities being undertaken by our partners are sales is expected to be Eroton’s agreement with Independent reserves report by Gaffney Cline
expected to significantly reduce downtime and Energy Link Infrastructure (Malta), or ELI. ELI & Associates from the end of 2019 indicates an
losses going forward, benefiting our initial indi- will finance and construct the ACOES and once increase in reserves and contingent resources
rect interest of 10.58% in OML 18. commissioned, this system is expected, by Ero- at Abu Sennan: 12.5% increase in Abu Sennan
“Our robust financial position, additional ton, to significantly reduce the downtime and Gross 2P Reserves to 13.5mn boe (15% gas)
significant funds expected to be received in the allocated pipeline losses currently associated compared to 12mn boe at the beginning of
in the next 18 months, existing and anticipated with the NCTL. The NCTL was responsible for 2019, representing a 190% reserves replacement
new projects, are planned to continue to provide the majority of the approximately 20,000 bpd ratio, gross 1P reserves up by 76% to 4.2mn boe
continued shareholder returns. We are proud to difference between gross production, when and gross 3P reserves up by 46% to 28.6mn boe
have distributed $66.0mn to shareholders in the the pipeline is running, and average sales oil. In (from 2.4mn boe and 19.6mn boe respectively
past 15 months. addition, it is anticipated that the FSO project at the beginning of 2019), gross 2C contingent
“San Leon is very well placed to continue will greatly improve overall well uptime. resource add of 0.73mn boe, reserves upgrade
to deliver its strategy in the year ahead and the “In January 2019, San Leon also announced does not include the recent drilling success at the
Board looks forward to updating shareholders that Eroton had successfully restructured its RBL El Salmiya-5 Well.
on the Company’s progress.” facility, providing a material boost to cash availa- The Company will hold an investor call at
Mutiu Sunmonu, chairman, said: “OML 18 bility for operations, and reducing the burden of 11:00am on Thursday, June 25, 2020.
is positioned for its next stage in development. cash required in the DSRA. Jonathan Leather, COO of United Oil & Gas,
2019 saw significant progress being made at “San Leon is becoming increasingly involved said:”It is really pleasing to see the Abu Sennan
OML 18 as the partners looked to advance the with the subsurface technical input into OML 18 assets continuing to perform so strongly and the
asset to its next phase of development. and has a contract to provide such services on potential that we recognised in the assets being
“Eroton continued drilling three new wells OML 18, providing geoscience and engineering realised. Much as we expect the production at
as well as ensuring considerable progress on the resource into well and reservoir planning. We the El Salmiya-5 well to be choked back from the
new oil export system (Alternative Crude Oil believe that OML 18 is a world class asset and current levels, it is fair to say that net production
Evacuation and Storage system, or ACOES). one that we look forward to developing further of over 3,000 boepd at this stage has surpassed
Together, these activities are expected to ena- with our partners.” even our own high expectations for the Licence.
ble Eroton to reap rewards for the partners and San Leon Energy, June 25 2020 “We remain highly confident that the Licence
shareholders, including San Leon, as historic has more to offer. Further development at the
operational hurdles are overcome. United Oil & Gas issues ASH field is expected to deliver additional gas
“Downtime and allocated pipeline losses before the end of the year, further enhancing
associated with the use of the Nembe Creek update on Abu Sennan production and cashflow.
Trunk Line (NCTL) have meant that both gross “We also see substantial exploration opportu-
production at the wellhead and sales oil volumes reserves upgrade and nity on the licence and are working towards opti-
were lower than expected. Gross oil production, mising targets for further exploration drilling in
taking out the effect of NCTL downtime, was production update due course.This independent review of reserves
around 50,000 bpd. Sales oil, including the effects should send a clear message about the strength
of downtime and allocated losses, was around Highlights: 13,900 boepd gross (3,060 boepd of the Company’s Egyptian assets.”
29,500 bpd. It is notable that the pipeline losses net working interest) average production from United Oil & Gas, June 24 2020

Week 27 01•July•2020 www. NEWSBASE .com P19