12 Nov 2018 07:00
12 November 2018
Eland Oil & Gas PLC
("Eland" or the "Company")
Confirmation of Licence Renewal
Eland Oil & Gas PLC (AIM: ELA), an oil & gas production and development company operating in West Africa with an initial focus on Nigeria, is pleased to announce, through its joint-venture subsidiary, Elcrest Exploration and Production Nigeria Ltd ("Elcrest") that the Honourable Minister of Petroleum Resources has consented to Elcrest's renewal of its equity participation in Oil Mining Lease 40 ("OML 40"), for a further 20 years, taking effect on 22 October 2018.
The consent is conditional on Elcrest payment of a Renewal bonus of US$6.3 million within 90 days and a commitment from the OML 40 JV to gas monetisation and additional sale 25MMSCF/Day with the gas sales agreement to be signed within 5 years. The Company is currently preparing the title deed for OML 40 to conclude the renewal process. All other conditions precedent to the consent have been met.
George Maxwell, CEO of Eland, commented:
"We are delighted to confirm the formal renewal of our OML 40 licence. This continues the OML 40 Joint Venture's excellent opportunity to continue the significant investment into OML 40's work programme; continuing to increase production, proven reserves, cash flow local employment and government take.
We look forward to a continuing positive partnership with Nigerian Petroleum Development Company and pushing together to make OML 40 one of the most significant license blocks in Nigeria."
For further information:
Eland Oil & Gas PLC (+44 (0)1224 737300)
www.elandoilandgas.com
George Maxwell, CEO
Ronald Bain, CFO
Finlay Thomson, IR
Canaccord Genuity Limited (+44 (0)20 7523 8000)
Henry Fitzgerald O'Connor / James Asensio
Camarco (+44 (0) 203 757 4980)
Billy Clegg / Georgia Edmonds / Tom Huddart
Notes to editors:
Eland Oil & Gas is an AIM-listed independent oil and gas company focused on production and development in West Africa, particularly the highly prolific Niger Delta region of Nigeria.
Through its joint venture company Elcrest, Eland's core asset is a 45% interest in OML 40 which is in the Northwest Niger Delta approximately 75km northwest of Warri and has an area of 498km². In addition, the Company has a 40% interest in the Ubima Field, onshore Niger Delta, in the northern part of Rivers State.
The OML 40 licence holds gross 2P reserves of 83.4 mmbbls, gross 2C contingent resources of 40.4 mmbbls and a best estimate of 254.5 mmbbls of gross unrisked prospective resources.* The Ubima field holds gross 2P reserves of 2.4 mmbbls of oil and gross 2C resource estimates of 31.1 mmbbl.**
Net production figures relate to Elcrest Exploration and Production Nigeria Ltd ("Elcrest"), Eland's joint venture company. Production rates, when oil is exported via Forcados, are as measured at the Opuama PD meter, are subject to reconciliation and will differ from sales volumes.
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.