Page 17 - AfrOil Week 19 2020

AfrOil
NEWS IN BRIEF
AfrOil
Neptune’s VP Exploration & Development Gro Haatvedt added: “It’s very exciting to have been involved in the OBN seismic survey, the first time the technology has been deployed in Egyptian waters. Given the geographically-di- verse nature of our global portfolio, Neptune is accustomed to working with innovative digital and subsurface technologies to tackle a variety of geological challenges. Obtaining subsalt imaging is particularly tough, and the OBN technology was well-suited for this purpose. The next step is to analyse the data which has greatly improved our understanding of the block and will support our future plans including potential exploratory wells.”
Neptune Energy, May 07 2020
PERFORMANCE
Africa Oil announces
Q1-2020 financial and
operating results
Africa Oil Corp. is pleased to announce its finan- cial and operating results for the three months ended March 31, 2020.
Africa Oil closed the acquisition of a 50% ownership in Prime Oil and Gas for a cash con- sideration of $519.5mn. Prime holds interest in deepwater Nigeria assets, including three oil fields, that in aggregate produced about 530,000 barrels of oil equivalent per day (boepd) during the period.
Average daily working interest of about 33,500 boepd (88% oil) and economic entitle- ment production of about 43,000 boepd (88% oil), net to Africa Oil’s shareholding in Prime at an average operating cost of $5.8 per boe.
Africa Oil received two dividend payments for a total amount of $87.5mn and recognised operating income of $85.6mn related to its investment in Prime, contributing to its total operating income of $87.1mn.
Africa Oil’s operating income was offset by $218.0mn in operating expenses, which is mostly accounted for by a $215.6mn non-cash impairment of intangible exploration assets in Kenya.
The Company drew $250.0mn under an acquisition term loan facility with BTG Pactual E&P in order to complete the acquisition of its interest in Prime. The Company utilised divi- dends received from Prime to pay down the loan by $45.2mn during the quarter. Africa Oil ended the period with $72.5mn in cash and net debt of $132.3mn.
Prime sales revenue of $179.5mn5, EBITDA of $198.3mn and cash flow from operations of $196.0mn, in each case net to Africa Oil’s 50%
shareholding.
The Company released its year-end 2019
statement of reserves with entitlement Proved Reserves (1P) of 52.3mn barrels of oil equivalent and entitlement Proved plus Probable Reserves (2P) of 85.1 MMboe, net to its shareholding in Prime.
The Company completed the acquisition of a 20% participating interest in Block 3B/4B Explo- ration Right in South Africa from Azinam Ltd for a consideration of approximately $3.0mn; participated in a private placement to invest approximately $12.0mn in Impact Oil & Gas Ltd.; and participated in a private placement to invest approximately $5.0mn in Africa Energy.
Operational performance at the Nigerian assets has not been impacted by the COVID-19 pandemic. In Kenya, activities that can be com- pleted safely in home/office environments have continued and all non-essential field activities have been suspended.
Africa Oil President and CEO Keith Hill commented: “I am delighted that today we are reporting on a positive quarterly period for the Company. The highlight is the closing of the Prime acquisition, giving us economic interests in three high quality producing assets. Excellent operations at these fields have resulted in Prime’s strong financial performance for the period. Unfortunately, our transformational Prime acquisition has been followed by the COVID-19 pandemic that has impacted the international community to an extent that was unforeseen at start of the year.
“Our top priority is the safety of our employ- ees, contractors and partners. We will continue to actively monitor the pandemic situation and take the necessary measures to mitigate its impact on our health and business performance.
“I believe that we should hope for the best and
plan for the worst. I take great comfort in Prime’s industry leading oil hedging position that pro- vide for stable cash flows. More than 90% of Prime’s production is hedged at an average price of $66 per barrel and most of its production for first quarter 2021 is hedged at an average price of $60 per barrel. Also, we have taken imme- diate steps to cut costs and defer discretionary capital expenditures. I am confident that we are in a robust position to ride out these turbu- lent markets and to emerge in a strong position to benefit from future business development opportunities.”
Africa Oil Corp., May 07 2020
PERSONNEL
African Energy Chamber issues advisory guidelines for the management and safety of oil workers during pandemic, lockdowns
Amid the ongoing effects of lockdowns in oil and gas-producing countries such as Nigeria, Angola, Algeria, Egypt, Libya, Congo, Gabon, Ghana, Equatorial Guinea, South Sudan and Cameroon, the African Energy Chamber hereby issues pragmatic commonsense advisory guidelines for governments, oil companies and personnel.
This is aimed at mobilising, demobilising and putting back our energy sector to work safely across the continent. The guidelines are open for free consultation at www.EnergyChamber.org.
Week 19 13•May•2020
w w w . N E W S B A S E . c o m
P17