Africa Oil 2019 Third Quarter Financial Results

Africa Oil Corp. (“Africa Oil” or the “Company”) announced its financial and operating results for the three and nine months ended September 30, 2019. All dollar amounts are in United States dollars unless otherwise indicated. View PDF version


The Company ended the quarter with cash of $330.3 million and working capital of $300.2 million;

Subsequent to end of the quarter the Company announced it had entered into an amendment to the share purchase agreement (the “Amended SPA”) signed on October 31, 2018, between Petrobras International Braspetro B.V. and Petrovida Holding B.V. (“Petrovida”), a company formed to acquire an ownership interest in Petrobras Oil and Gas B.V. (“POGBV”). Consequently, Africa Oil will be the sole acquirer of the 50% interest in POGBV, having increased its ownership in Petrovida to 100%. The closing of this deal is subject to Government of Nigeria’s approval;

The primary assets of POGBV are an indirect 8% interest in Oil Mining Lease (“OML”) 127, which contains the producing Agbami Field, operated by affiliates of Chevron Corporation, and an indirect 16% interest in OML 130, operated by affiliates of TOTAL S.A., which contains the producing Akpo and Egina fields;

The first ever oil export from Kenya, a cargo of 240,000 barrels, sailed away from Mombasa on August 26, 2019. This shipment was a major milestone for the country and the Company’s South Lokichar project. The project’s Early Oil Production System (“EOPS”) is producing at 2,000 barrels of oil per day (“bopd”) with all the crude being trucked from Turkana to Mombasa. Africa Oil has a 25% working interest in the upstream assets (Block 10BB and 13T);

On August 12, 2019, the Company announced that the Jethro-1 exploration well made the first oil discovery on the Orinduik block, offshore Guyana. On September 16, 2019, the Company announced a second oil discovery on this block with the Joe-1 exploration well, resulting in the opening of a new Upper Tertiary oil play in the Guyana basin. Africa Oil holds an approximately 18.7% equity interest in Eco (Atlantic) Oil & Gas Ltd. (“Eco”), and Eco holds a 15% working interest in the Orinduik Block;

Subsequent to end of the quarter the operator (Tullow) of the Orinduik block announced that: “Following the completion of well operations, oil samples were sent for laboratory analysis and results indicate that the oils recovered from both Jethro-1 and Joe-1 are heavy crudes, with high sulphur content. Tullow and the Joint Venture Partners are assessing the commercial viability of these discoveries considering the quality of the oil, alongside the high-quality reservoir sands and strong overpressure”;

On July 3, 2019, the Company announced entering into a definitive farm-out agreement with Azinam Limited for a 20% participating interest and operatorship in the Exploration Right for Block 3B/4B, offshore South Africa. This block covers an area of 17,581 square kilometers and is located along-trend of an emerging Mid-Cretaceous oil play where operators are planning to drill several key exploratory wells. These have the potential to be play-openers for a world-class petroleum province.

Source / More : Africa Oil


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