TIDMAAOG
RNS Number : 8943Y
Anglo African Oil & Gas PLC
11 December 2017
Anglo African Oil & Gas / Index: AIM / Epic: AAOG / Sector:
Oil & Gas
11 December 2017
Anglo African Oil & Gas plc ('AAOG' or the 'Company')
Corporate Update
Anglo African Oil & Gas plc, an independent oil and gas
developer, is pleased to announce a corporate update in line with
its plan to increase production and reserves at its 56% owned
Tilapia oil field ('Tilapia') in the prolific Lower Congo Basin.
The Company's strategy includes the workover of existing wells and
the drilling of TLP-103, a new multi-horizon well which, in
addition to targeting producing reservoirs and an 8.1m barrel gross
contingent resource discovery, will test a deeper prospect which
has been assigned 58.4m barrels of gross prospective resources.
Update on new licence and drilling of TLP-103
Discussions are at an advanced stage with the relevant
authorities in the Republic of the Congo (the 'Congo') for the
award of a new licence in respect of the Tilapia field which, if
awarded, will extend AAOG's interest in Tilapia for a considerable
period beyond the 2020 end date of the current licence. AAOG wishes
to ensure that this process is completed before the start of
drilling of TLP-103. AAOG is very pleased with progress on the
licence extension and hopes to provide a further update on this
before the end of the year.
AAOG has recently inspected its preferred rig for the drilling
of TLP-103, which is on operation with a major international oil
company in the Congo. The work for that other company is now
scheduled to complete in January, a delay from the earlier estimate
of mid-December. Negotiations for the terms for the preferred rig
are in their final stage. Due to the delays in the availability of
this rig over the past months, the Company has taken steps to
mitigate the effect of any further delay. In particular, the
Company is discussing alternative offers in place from other
contractors in order to ensure that drilling can commence in Q1
2018. Consistent with this, the Company will not sign a rig
contract until availability is guaranteed.
The Company has managed its cash resources carefully, and
continues to do so. It has sufficient capital to meet its share of
the costs of drilling TLP-103.
Appointment of highly experienced Operations Manager to oversee
drilling of TLP-103
As announced in the Company's Half-Yearly Report of 26 September
2017, Mr Alain Guiraud has been appointed on a fixed project
contract basis as Operations Manager to oversee the drilling of
TLP-103. Mr Guiraud will be based in the Congo for the duration of
this project.
During a career spanning 45 years, Mr Guiraud has held senior
operational positions with several leading oil and gas companies
such as Chevron, Elf, Petrobras, BP, Shell, Texaco, Phillips and
ENIEPSA, on both offshore and onshore projects around the world. He
has extensive experience of the Congo, including as Country Manager
for Halliburton, the leading oil services provider, as General
Manager and Operations Manager for SFP/SNPC, the Congolese NOC,
overseeing onshore drilling projects, and as Country Manager for
Caroil, an oil drilling company wholly owned by Maurel & Prom,
the Paris-based independent oil group. As a result, he has
excellent knowledge and experience of working on onshore fields
that are close to and share the same geology with Tilapia.
Mr Guiraud is working closely with Mr Gerard Bourgoin, the
Directeur General of the Company's wholly owned subsidiary Petro
Kouilou, through which AAOG holds its 56 per cent interest in
Tilapia, and with David Sefton, Executive Chairman of AAOG.
In addition, Alex MacDonald's job title has been changed from
that of Chief Executive Officer to Country Manager, Republic of the
Congo. Mr MacDonald is currently on sick leave and is not expected
to return to work until 7 January 2018.
Tilapia production update
TLP-101 remains in production. While there has been no increase
in the flow rate of TLP-101, production gains are expected once the
flow lines between the wellhead and separator are replaced to allow
the removal of detritus material, which tests indicate is
inhibiting production.
Testing of the R2 reservoir by AAOG earlier this year confirmed
the presence of recoverable hydrocarbons at TLP-102. However, the
workover of TLP-102 will now need mechanical intervention, which
will be carried out by the rig after the drilling of TLP-103.
The Company continues to believe TLP-101 and 102 have the
potential to produce at a combined rate of between 185 and 250
bopd.
David Sefton, Executive Chairman of AAOG, said: "Targeting
proven sands, an existing discovery and a deeper interval that is
known to be a prolific producer on neighbouring fields, TLP-103 is
potentially a transformational well for AAOG. It is therefore key
that we have the right team and the right equipment in place to
ensure the best chance of success. We have now secured the services
of a first-rate operations manager who, thanks to having extensive
experience in this prolific region, has first-hand knowledge of the
geology and the operating environment at Tilapia.
"We are conscious that there have been delays due to the
availability of our preferred rig, and that this has caused
frustration to shareholders. We are working hard to secure the new
licence and ensure that drilling can commence as early as possible
in 2018."
**ENDS**
For further information, please visit www.aaog.co or
contact:
Anglo African Oil & Gas plc Tel: c/o St
Brides Partners
+44 20 7236
1177
David Sefton, Executive Chairman
finnCap Ltd (Nominated Adviser Tel: +44 20
and Broker) 7220 0500
Christopher Raggett, Giles Rolls,
Anthony Adams (Corporate Finance)
Emily Morris (Corporate Broking)
St Brides Partners (Financial PR) Tel: +44 20
7236 1177
Frank Buhagiar, Olivia Vita
The information communicated in this announcement is inside
information for the purposes of Article 7 of Regulation
596/2014.
Notes to Editors
Anglo African Oil & Gas (AAOG) is an AIM-listed independent
oil and gas company owning a 56 per cent interest in the producing
Tilapia oil field in the Republic of the Congo with the remaining
44 per cent held by SNPC, the national oil company of the Republic
of the Congo. The Company boasts a low-cost production story in a
prolific hydrocarbon region with significant exploration upside,
differentiating it substantially from its E&P peers.
Additionally, management's remuneration is tied to hitting
production milestones, reflecting their strong focus on cost
control.
The Company's strategy is centred on the workover of existing
wells and the drilling of TLP-103, a new multi-horizon well which
will target the producing R1, R2 Sands; develop an 8.1m barrel
gross contingent resource discovery in the Mengo Sands; and test
the deeper Djeno Sands which have been assigned 58.4m barrels of
gross prospective resources.
Tilapia has an excellent address, being located close to
multi-billion-barrel fields that include the ENI-operated
Litchendjili field and the 5,000/bopd Minsala Marine field. Tilapia
currently produces approximately 45 bopd from two near-surface
intervals. It has an undeveloped discovery in the lower Mengo sands
with gross contingent resources of 8.1m barrels and a deeper
exploration prospect, with gross prospective resources of 58.4m
barrels, in the productive Djeno interval, from which the adjacent
Minsala field produces.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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