Advance Energy #ADV took over Andalas Energy in February 2020 for their AIM-listing and are looking to to make their first oil and gas acquisition to put into that vehicle. In an in-depth interview with CEO Leslie Peterkin, we explored the strategic do's and don't for Advance.
Leslie is an equable Scotsman, one of many in the oil and gas industry, and he thinks that he and his highly experienced team of four have what it takes to deliver a mid-cap company in three or so years time. He thinks the first deal could be made public in a few months, with another before the end of 2021.
What kind of deals are Advance looking for? Leslie says the five key tenets are as follows:
1. We are non-operated
2. We are only interested in what is discovered
3.We don't do exploration
4. We are interested in being non-operated with two-party joint ventures
5. In terms of location we are Eastern Hemisphere excluding Russia, China and Iran.
"We have a lot of experience in the America's but so do many others, and we have decided to leave that out. The three founders have over 100 years of E&P experience between them, technical and commercial, and we have a record of serial delivery, of adding value to existing fields both oil and gas.
"We are not looking for small assets or difficult assets that are being rehabilitated, we want to get something that's going to do for us net 20,000 bopd or 10,000 bopd, assets of some magnitude in the not too distant future.
"We have a specific niche we are looking for, which is our strategy, and that combined with our experience tells us that in our view we will deliver substantial value once we get traction".
So what differentiates Advance? "Our asset base. These are all assets we brought in with us, which are effectively discovered and not developed, and have some issues either technical or commercial that haven't been resolved by other parties that have looked at it, and we have a different view and are pursuing them on the basis that we can unlock value that others perhaps weren't able to do.
"We have seen one in particular which has come to us since we were started and we are pursuing that one with some interest but probably back in the chain as it were. And making very good progress on at least one. We are specifically looking for assets which provide cashflow so we don't have to come back to the market and keep asking for funds to keep going. Cashflow and debt are both part of the equation."