22 Nov 2016 17:21
22 November 2016
LEKOIL Limited
("LEKOIL" or the "Company")
Receipt of Nigerian Ministerial Consent for Initial OPL310 Farm-in
LEKOIL (AIM: LEK), the oil and gas exploration and development company with a focus on West Africa, notes the announcement made today by its partner in OPL 310, Optimum Petroleum Development Ltd., regarding the receipt of Ministerial Consent by Mayfair Assets and Trust Limited ("Mayfair"), a wholly owned subsidiary of LEKOIL Nigeria Limited, for its 17.14% economic interest in OPL 310.
LEKOIL is working with the regulatory agencies to clarify and amend the conditions stated in the consent letter to be in line with Nigerian law and further announcements will be made as and when appropriate. LEKOIL Limited holds 90% of the economic interests in its subsidiary, LEKOIL Nigeria Limited.
For further information, please visit www.lekoil.com or contact:
LEKOIL Limited Alfred Castaneda, Investor Relations Hamilton Esi, Corporate Communications |
+44 20 3434 5800 +44 20 7920 3150 |
Strand Hanson Limited (Financial & Nominated Adviser) James Harris / James Spinney / Ritchie Balmer |
+44 20 7409 3494 |
Mirabaud Securities LLP (Joint Broker) Peter Krens / Edward Haig-Thomas |
+44 20 7878 3362 / +44 20 7878 3447 |
BMO Capital Markets (Joint Broker) Jeremy Low / Neil Haycock / Thomas Rider |
+44 20 7236 1010 |
Tavistock (Financial PR) Simon Hudson / Barney Hayward / Merlin Marr-Johnson |
+44 20 7920 3150 |
Background on OPL310
On 1 February 2013, Mayfair Assets and Trust Limited, a wholly owned subsidiary of Lekoil Nigeria Limited, farmed into Afren Investments Oil and Gas (Nigeria) Limited's interest in OPL 310 for a 17.14% participating interest and 30% economic interest.
Later that year the first exploration well (Ogo-1) drilled by the OPL 310 partners - then consisting of Optimum, LEKOIL Limited and Afren Plc - was the Ogo prospect, a four-way dip-closed structure in the Turonian to Albian sandstone reservoirs. The drilling programme included a planned side-track well (Ogo-1 ST) which aimed to test a new play of stratigraphically trapped sediments at the basement of the Ogo prospect. The Ogo-1 well encountered a gross hydrocarbon section of 524ft, with 216ft of net stacked pay whilst the Ogo-1 ST well encountered the same reservoirs as Ogo-1 in addition to the syn-rift section which encountered a 280 ft vertical section gross hydrocarbon interval. Owing to well data collected from the two wells, the partners estimated P50 gross recoverable resources to be at 774 mmboe across the Ogo prospect four-way dip-closed and syn-rift structure.
On 31 July 2015, Afren Plc, the parent company of Afren Oil & Gas that held interests in the OPL 310 licence, was put into administration and its assets put up for sale. LEKOIL Limited moved quickly to protect its interests in OPL 310 by beginning discussions with the administrator of Afren Plc for the potential acquisition of its subsidiary interests in OPL 310. On 25 November 2015, the Company entered into an agreement with the administrator of Afren Plc and Afren Nigeria Holding Limited to acquire the shares of Afren Oil & Gas which held a 22.86 per cent participating interest in OPL 310 for a total consideration of US$13 million. Application for Ministerial Consent for this interest has been made and is pending.
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