Page 6 - AfrOil Week 34 2022

AfrOil INVESTMENT AfrOil

DNO acquires stakes in two

blocks offshore Côte d’Ivoire

CÔTE D’IVOIRE NORWAY’S DNO announced on August 22 However, Block CI-27 is a relatively advanced
that it had reached agreement with UK-based project. The licence area has Côte d’Ivoire’s larg-
RAK Petroleum on a transaction that will make est known reserves of natural gas and also holds
it a shareholder in two upstream projects off- crude oil and gas condensate. It is already yield-
shore Côte d’Ivoire. ing gas from four fields connected via tie-backs
In a statement, the company explained that to two fixed platforms in quantities large enough
RAK had agreed to transfer its holdings in its to account for more than 75% of the country’s
subsidiary Mondoil Enterprises to DNO. This gas consumption.
stock-only transaction covers Mondoil’s 33.33% The largest of the four fields at Block CI-27 is
stake in Foxtrot International LDC, a privately Foxtrot, which began production in 1999, and
held firm that has a 24% stake in Block CI-12 the other three are Mahi, Manta and Marlin.
and a 27.27% stake in Block CI-27, it noted. Fox- Mahi came on stream in 2012, and Manta and
trot serves as operator of the joint ventures set up Marlin followed suit in 2016 after the Foxtrot-led
to explore and develop both sites, it said. joint venture implemented a $1bn development
The effective date of the transaction will campaign over a period of four years. These four
be set at January 1, 2022, and DNO will issue fields yielded a total of 200mn cubic feet (5.7mn
some 78,943,763 shares at a price of NOK14.38 cubic metres) per day of gas on average in the
($1.48) each as consideration, the statement first half of 2022, DNO noted in its statement.
said. It added: “[The] agreed consideration is The partners pump gas to shore via pipeline
$117.25mn, covering the transfer of 100% of at rates that have risen over time to the current
Mondoil Enterprises share capital valued at level of 140mn cubic feet (3.96mn cubic metres)
$95mn, comprising 9.09% indirect working per day. In turn, the pipeline delivers most of
interest in Block CI-27 and 8% in Block CI-12, the gas to a thermal power plant (TPP) in Abid-
both held through the ownership in Foxtrot jan under a take-or-pay gas sale and purchase
International, and $22.25mn, including $21mn agreement (SPA) that has been in force since
in cash and $1.25mn in working capital.” June 1999. That SPA sets the base price of the
Work at Block CI-12 is at a relatively early gas at $6 per mmBtu but also utilises an indexa-
stage, and Foxtrot and its partner only have tion formula that has boosted the current price
an exploration licence for this licence area. to $6.47 per mmBtu, DNO noted.

Block CI-27 accounts for more than 75% of the country’s current gas consumption (Image: Foxtrot International)

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