4 Aug 2021 07:00
4 August 2021
Victoria Oil & Gas Plc
("VOG" or the "Company")
Q2 2021 Operational Update
Victoria Oil & Gas Plc, whose wholly owned subsidiary, Gaz du Cameroun S.A. ("GDC"), is the onshore gas producer and distributor with operations located in the port city of Douala, Cameroon, is pleased to provide shareholders with a brief operations update for the second quarter of 2021.
SUMMARY
· Sales: Average daily gross gas sales rate for the quarter of 5.4 MMscf/d (Q1 21: 5.2 MMscf/d) of natural gas, plus gross 4,468 bbls (Q1 21: 5,357 bbls) condensate was shipped to customers.
· La-108 Performance: The well produced a cumulative 0.467 Bcf before it was shut-in to allow us to perform a pressure build up ("PBU"). The other wells are able to satisfy current demand.
· Matanda: Well planning continues and tendering for long lead items and key equipment and services has commenced.
Roy Kelly, Chief Executive of Victoria Oil & Gas, commented:
"We are very pleased that the team has delivered another solid quarter during which some customers increased organic demand, although we are conscious that we are now heading into August which is usually a slower month. Operationally, I am delighted to report that in June GDC passed one million man-hours without a single Lost Time Incident, a credit to all the staff and contractors.
We are considering adding perforations to well La-108, more than doubling the net pay, and this is being discussed with partners. Such is the depth and pressure difference between the top and bottom of the reservoir that perforating must be done in two stages. Adding perforations could increase the well's productivity, reduce the overall water cut and of course allow us to access all of the well's connected gas volumes.
We look forward to updating shareholders in due course on our various workstreams."
LOGBABA UPDATE
Quarterly Production
GDC continues to safely produce and sell natural gas to a variety of customers in the Douala area, who would otherwise be burning liquid fuels. Quarterly gross and net gas sales and condensate shipments at Logbaba are as follows (amounts in bold are net gas and condensate sales attributable to GDC (57%)):
| Q2 2021 | Q1 2021 | ||
Gas sales (MMscf) |
|
|
|
|
Thermal | 261 | 458 | 252 | 442 |
Industrial power | 17 | 29 | 13 | 23 |
Total (MMscf) | 278 | 487 | 265 | 465 |
Daily average gross gas sales rate (MMscf/d) | 5.4 | 5.2 | ||
Condensate shipped (bbls) | 2,547 | 4,468 | 3,054 | 5,357 |
La-108 Performance
Together with the volumes produced during testing last year, the well has produced a cumulative 0.467 Bcf to date (over 111 days), and it had been supplying the majority of the gas produced whilst it was on production. La-108 was shut in on 6 June, the other wells meeting the needs of the customers, enabling us to carry out a long-term PBU, which will allow us to learn more about the reservoir system that it has been producing from.
MATANDA UPDATE
In addition to progressing the well planning of our first well in the Matanda licence, we have presented the farmout opportunity to a number of parties who continue their evaluations.
WEST MED UPDATE
A period of exclusivity with a potential buyer expired at the end of May 2021, and we continue discussions with that counterparty though we have not renewed the exclusivity at this time as we are engaged with other parties who have expressed an interest.
LITIGATION UPDATE
The arbitration in Texas, USA under ICC rules (initiated in October 2018) was heard at the end of April, and we await the Panel's findings, likely to be announced in August or September.
The arbitration in London under UNCITRAL rules (initiated in February 2020) will be heard at the end of September.
As we have said before, arbitrations under ICC and UNCITRAL rules are confidential processes and VOG is not permitted to provide detailed comments on them, beyond saying that it continues to vigorously defend the claims raised by RSM. The amounts under dispute in this arbitration, including GDC's counterclaims, are significant and an adverse finding could have a material impact upon the results and position of the Group.
For further information, please visit www.victoriaoilandgas.com or contact:
Victoria Oil & Gas Plc
Roy Kelly/Rob Collins Tel: +44 (0) 20 7921 8820
Strand Hanson Limited (NOMAD)
Rory Murphy/James Dance Tel: +44 (0) 20 7409 3494
Shore Capital Stockbrokers Limited (Broker)
Mark Percy/Toby Gibbs (corporate advisory) Tel: +44 (0) 207 408 4090
Jerry Keen (corporate broking)
Camarco (Financial PR)
Billy Clegg/Nick Hennis Tel: +44 (0) 20 3772 2499
Notes
Sam Metcalfe, the Company's Subsurface Manager has reviewed and approved the technical information contained in this announcement in his capacity as a qualified person under the AIM Rules. Sam has over 35 years of industry experience, and has an MSc in Petroleum Engineering from The University of Texas at Austin.