Afentra Share Discussion Threads

[chris_engel] 14/7/2023 16:14

"This was the principal reason why the Government materially recently improved the Fiscal terms, to attract new investment & extend existing licences to avoid the assets becoming 'stranded'."

As far as I understand it, the JV partners and the Angolan Oil & Gas regulator have agreed on new terms for block 3/05 only. Also, these terms have yet to be formally approved (whatever that means). Also, the new terms are not given until approval. So while they might be material, we just don't know this yet. But I do agree, it does send a positive signal for further investment in Angola.

[mount teide] 13/7/2023 17:09

Jung - Yep, extreme value here now considering the huge discount to the headline price, as a result of the April 2022 effective economic date of the deal.


Block 3/05 - 'Sonangol assumed operatorship in 2005 and has since focused entirely on sustaining production through workovers and maintaining asset integrity.

No infill drilling campaigns have taken place for 18 years on the asset. The asset currently produces from around 40 production wells and has nine active water injectors.'....Offshore Technology

Block 3/05 - what is remarkable about the performance of these conventional, swallow water field's, is that despite not having an infill well drilled on them for 18 years, they're still producing at close to 20,000 bopd!

Peak production was 193,000 bpd of crude oil and condensate.

Would not surprise me if the third transaction in Angola is for a further chunk of Block 3/05: Maybe ENI's 12% or Somoil's 10%.

Strongly suspect Angola will remain Afentra's principal acquisition target.

Angola has over 300 discovered O&G fields, but to date less than half have been developed.

This was the principal reason why the Government materially recently improved the Fiscal terms, to attract new investment & extend existing licences to avoid the assets becoming 'stranded'. It's had some very impressive early commercial success - with Exxon, who are increasingly vacating the rest of Africa, signing up to put $15bn of CAPEX into three large offshore blocks.

The Angolans are actively seeking more oil & gas investors and with Afentra having built a commercial relationship with the divesting National state-owned oil company, Sonangol, its positioned us perfectly as a working partner, for the highly material pipeline of future acquisition opportunities from the National Oil Company.

AIMHO/DYOR

[jungmana] 13/7/2023 10:43

GBP 50m market cap at 24p will be extremely cheap here once the Sonangol deal completes soon. Imo will be at least 40p.With the top class management, this should be in the portfolio of any good small cap oil investor imo.

[maverickps123] 13/7/2023 10:25

Just added and will for news!

[chris_engel] 10/7/2023 09:43

Does anyone have information on the tax regime/psc for block 3/05? I have found some information on Angola but block 3 seems to have different fiscal terms. Also, there is talk that fiscal terms have improved. Is this agreed? Does anyone know what the improvements are?

[mount teide] 03/7/2023 14:00

Angolan Regulator focused on targeting new upstream investment from medium and small companies - Afentra mentioned.


Angola makes its pitch: “Flexibility is our middle name” - Energy Voice 30th June 2023

'Angola’s regulator is focused on attracting investment into the upstream, putting a particular focus on new investment from medium and small companies, according to a recent presentation.

The West African state will continue testing its appeal through bid rounds. It is launching its next offering, focused on the Lower Congo and Kwanza basins on September 30. The round will be open until November 9.

Recent winners include awards on KON-2, KON-11, KON-12 and KON-16 in May.

Angola tweaked its terms four years ago, explained Agencia Nacional de Petroleo, Gas e Biocombustiveis (ANPG) negotiations director Alcides Andrade. “The aim was to be the best choice for energy investors worldwide,” he told the audience at IN-VR’s Global Energy Week.

The country’s aim was to “mitigate the decline in production”, he continued. Production peaked in 2008 at 1.9mn barrels per day. “Since 2016, we have been fighting the decline curve.”

Natural decline from its deepwater assets is 15-20%, Andrade said. Angola has now stabilised its production, he said through the new reforms. “We’ve stabilised production above 1.1mn bpd. The strategy is to keep production for many more years to come above 1mn bpd.”

ANPG expects existing opportunities to keep up output, while the new licences should start to bear fruit from 2029.

“We have tried to achieve the right environment for investors to come to Angola. We have a stable fiscal and contractual environment. It is important we continue to create such an environment to continue attracting new investment,” said ANPG executive board member Natacha Massano.

Andrade said the reforms should see investments reach $60 billion over the next five years, “that’s an increase of 40% from the last five years”. Most of that will be capital expenditure.

Part of the wave

The next licence round, launching in September, will offer 12 onshore blocks, four in the Lower Congo and eight in the Kwanza.

A number of blocks are also available under permanent offer, including Blocks 10, 11, 12 and 13. “Offshore is more capital intensive than the onshore licence rounds,” he said.

The work programme for the licence round aims for flexibility, he said. “Flexibility is our middle name,” the ANPG official said. Licences are available under production-sharing contract (PSC) terms. “The focus is that investors recover their investment through cost oil as soon as possible in the early stages.”

The profit sharing also should help ensure “investors have high returns”, he said. The aim is to attract companies to “invest and to continue investing”. Social and green projects will only become a factor once first oil has been achieved, he said. “The focus is to find ways for you to recover your investment fast. When to invest is now. Be part of the wave, don’t stay behind.”

Afentra nears

One company putting Angola to the test is Afentra, which completed a transaction with INA recently and is working on another with Sonangol. The London-listed company signed the deal in April 2022 and is just about to complete, said Afentra COO Ian Cloke.

“Does it take longer in Africa than in Europe? Yes. Does it take longer than it did a few years ago, I’m not sure,” Cloke said, referencing Tullow Oil’s plans to sell down in Uganda. “You need to know your stakeholders and if you don’t listen to them that’s a problem. In Africa, you always have to be patient.”

The executive went on to note ANPG’s “forward thinking” approach. “They’ve recognised the majors will be moving into deepwater and LNG. They want to encourage smaller players. It went from being quite a difficult place to, in the last two years, being much more positive.”

Angola’s appeal is paying off. ANPG has reported that 10 drilling units were active during May, including five drillships.'

[jungmana] 29/6/2023 16:50

I hope the Sonangol deal finally completes over the next 4 weeks and we can move on to the next ;"completion of the transaction is now expected to occur in July 2023 and we are working, together with Sonangol, to extend the long stop date for this acquisition accordingly."

[onedayrodders] 29/6/2023 14:18

Appears not

[yawn1971] 28/6/2023 16:35

Seller gone ?

[onedayrodders] 28/6/2023 12:19

AIM well and truly in the doldrums

[zengas] 27/6/2023 10:57

Todays AI article.

27/6/23

' Potential buyers waiting for Tullow Oil to pull out of Espoir

Production on Baleine, ENI's massive oil deposit in Ivorian waters, is expected to begin before the end of this year. This is great news for Ivory Coast, as the country's output has been down. Canadian Natural Resources (CNR) has struggled to maintain crude oil production levels on Espoir (9000 bpd - block CI-26) and Baobab (8,000 bpd - block CI-40). Its partner, Tullow Oil, is apparently currently looking for a company to acquire its shares.

Afentra, run by Tullow Oil's ex-MD Paul McDade, may be interested. Thierry Tanoh, Ivorian ex-oil minister, has just joined Afentra's board and will likely become its chair in the coming months. This should facilitate such a potential deal. Thus far, the firm has only invested in Angola, with shares of permit 3/05. It is pursuing its search for matured assets in West Africa in which to invest.

Production on Espoir continues to decline, and BW Offshore just sold the FPSO there to CNR. The drilling campaign planned to increase production has been delayed until 2025. Technical problems detected on Baobab's FPSO will likely lead to a suspension of production next year until the system can be repaired. Svenska Petroleum, another one of CNR's partners in Ivory Coast, owned by billionaire Mohammed Hussein al-Amoudi, is reportedly also looking to pull out and is in discussions with several potential buyers.'

[royalalbert] 20/6/2023 16:01

Yep, at this rate Sonangol could be paying AET.

[mount teide] 20/6/2023 15:55

Update on the Sonangol Acquisition:

'Subsequent to the approval of the licence extension in May 2023, Sonangol is now pursuing the requisite government approvals for the transaction. Based on the outstanding workstreams and associated timeframes, completion of the transaction is now expected to occur in July 2023 and we are working, together with Sonangol, to extend the long stop date for this acquisition accordingly.

In addition, the enhanced fiscal terms associated with the Block 3/05 PSA extension have been submitted for the requisite government approvals.
We look forward to providing shareholders with further updates in due course.

Operational Update:

As previously announced, recent gross production levels in Block 3/05 have continued to remain stable, averaging approx. 18,900 bbl/d in May 2023. Water injection levels have averaged approx. 39,000 bw/d January through May 2023. Finally, production in Block 3/05A, at the Gazela field, has continued at approx. 1,100 bbl/d.'


Take as long as you need fellows, as the Sonangol deal has an effective economic start date of April 22, with circa 15 months of accrued cash flows from the asset going to AET with a July completion date....reducing the final payment to a small fraction of the headline price, as a result of production remaining stable throughout and oil averaging around $95/bbl.

[gotabsirius] 14/6/2023 12:30

I doubt it, book cleared this morning and technical support hit. Similar pattern to axl with traders. Long term investors will be the big winners imho

[mount teide] 14/6/2023 12:25

Insider trading ahead of news!

[linz22] 14/6/2023 12:07

Wow, lift off. What's going on here then..?

[mount teide] 13/6/2023 16:23

Says a lot about Afentra and the aspirations of the management team, that they have been able to attract such an impressive individual to the Board.

[yousif] 13/6/2023 09:36

Good RNS
This appointment would help AET with expansion in Africa.

[mount teide] 10/6/2023 18:35

Considering the issues Jadestone Energy has experienced with the FPSO at their Montara Field, as a shipping professional, one of the first things I checked when carrying out research on Afentra, was the history of the 3/05 Block's FSO: Palanca.

What I found was very reassuring.



Angolan block 3/05 - FSO Palanca

FSO Palanca was towed 7,200 miles to the Sembawang Shipyard at Singapore in late 2012 to undergo dry docking/Special Survey. And to carry out a major programme of structural inspections, repairs, maintenance and upgrades to extend the commercial life of the ship by up to a further 20 years - 2032 is the current commercial life expectancy of the field.

The programme of work included:

* Renewal of the entire cargo pipeline system and cargo pumps.

* Hull cleaned, inspected, shot blasted, primed and coated. All damaged hull plating replaced.

* All cargo and ballast tanks cleaned, inspected, shot blasted, primed and coated

* Electrical systems - Renewal of all cabling.

* Accommodation enlarged from 30 to 60 people to carry more maintenance staff.

Estimated cost: $35-$40m


Some photos taken in April 2013, of Palanca after spending 4 months at the yard, immediately prior to departure for Angola.

[mount teide] 10/6/2023 18:18

During the last Oil/Commodity supercycle in the noughties, Paul McDade took Tullow from a valuation of 32p to 1,304p - a 40 bagger by primarily focusing on opportunities arising from the exit of the majors and NOC's from maturing assets.

It was a low risk growth strategy based on these maturing assets becoming marginal when competing for CAPEX funds of large O&G companies. The companies weren’t allocating production development capital for the assets and the same is again happening across many of the maturing O&G basins of West Africa and APAC today.

McDade plans to repeat the MO with Afentra by acquiring mature producing assets in large oil fields, most of which have been starved of investment since the oil price collapse of 2014. There are many opportunities becoming available, which like the current acquisition have huge infill well potential/re-investment opportunities, to materially extend the commercial life of these large under-developed assets way beyond the current predicated life.

With a primary focus on material production, and an experienced team with a high level operating capability used to working in the O&G basins of Africa, the company offers an excellent early stage opportunity to get in close to the ground floor for a similar run during this new oil/commodity super-cycle - just the third since 1970's.

Declaration - have continued to add to a 7 figure position built up last year, which I expect to hold for 3-5 years.

The journey has the potential to be as much fun and rewarding as in the noughties, since it will not only have the rising tide of a new oil/commodity super-cycle supporting it, but a strong tail wind too, from the impact of Majors/NOC's exiting high quality, large mature assets, as they increasingly move their capex dollars into major new offshore O&G projects and renewable energy projects; and Government's materially improving their O&G fiscal terms to attract investment to avoid being left with stranded assets. Nearly half of Angola's 300+ O&G discoveries are still to be developed.

AIMHO/DYOR

[jungmana] 09/6/2023 12:14

A good write up here in the daily mail midas column;

[jungmana] 09/6/2023 12:03

MT , Angolan government has basically laid the red carpet to foreign investors in its onshore oil and gas industry . Aet imo should just focus there with more acquisition and development of fields which majors are exiting. Hope the deal concludes soon and onto a third one with the $35 million available

[mount teide] 09/6/2023 11:49

Jung - Exactly; this is why Angola has been leading the way in making their fiscal terms more attractive to foreign O&G investors........to steal a march on access to the investment funds of a now much more discerning O&G sector - in the independent O&G sector investment has fallen by circa 60% since 2014, and only recently started a very tepid recovery.