Energem Share Discussion Threads

[energyi] 18/1/2006 17:14

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2005-12-22 10:15 ET - News Release
Mr. Rob Rainey reports
ENERGEM - GABON OIL FIELD DEVELOPMENT PROGRAMME APPROVED

Energem Resources Inc.'s 51-per-cent-owned and controlled upstream oil subsidiary company, FirstAfrica Oil PLC, has released the following news on Wednesday, Dec. 21, 2005:

FirstAfrica Oil PLC's wholly owned subsidiary GulfofGuinea Petroleum Corp. Gabon (EOV) Ltd. (GGPC) has received approval from the government of the Gabonese Republic for the field development plan for its East Orovinyare oil field offshore Gabon (EOV field).

The fast-track development plan calls for the first appraisal/development well to be drilled from early January, 2006, with the arrival in the field of the Global Santa Fe Adriatic IX jack-up rig. The previously announced mid-December, 2005, spud of EOV-4 has been delayed by three weeks due to extended operation of the drilling rig on its previous contract.

GGPC is the permitholder (100 per cent) and operator of the EOV field, which is located 13 kilometres offshore in 20 metres of water. Oil was discovered by the previous operator, Marathon, in the late 1990s. In addition to the discovered oil, the broader East Orovinyare permit area holds potential for incremental production from several exploration prospects currently under evaluation.


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Energem completes 80% of Nigerian facility

2005-12-22 11:19 ET - News Release ... Mr. Tony Teixeira reports

ENERGEM NIGERIAN OIL STORAGE AND DISTRIBUTION FACILITY 80% COMPLETE - COMPLETES 500,000 INJURY FREE CONSTRUCTION MAN HOURS

Energem Resources Inc. has reached 80-per-cent completion of its 50-per-cent-owned Nigerian oil storage and distribution facility, recording 500,000 injury-free construction man hours on the project. The company is constructing the facility together with 50-per-cent Nigerian joint venture partners, the Yinka Folawiyo Group (YFG). The facility will be a refined oil product storage facility with its own deepwater jetty in Apapa, Lagos, Nigeria, capable of handling multiple refined fuel products.

Nigeria, a country of approximately 100 million people, is a major crude oil exporting country, but remains dependent on imported refined products to service its internal consumption. On completion, this facility will be the only privately owned refined oil product storage and distribution facility in Lagos with access to a deepwater jetty. Currently vessels can spend up to 45 days offshore waiting to be discharged, at considerable additional cost.

[energyi] 03/2/2005 17:37

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Transcript of interview:
WSR: For those who may not be familiar with Energem Resources, why don't we begin with a brief history and overview of the company?

ENM: Energem Resources today is a Pan African resource group, which derives from the old company called DiamondWorks. The company name changed six months ago to depict what we do today. Mainly our business and resources in Africa consists of mining resources, i.e., diamonds, obviously gold, platinum and so on, downstream and midstream oil and more recently, upstream oil. That's why the name has changed to Energem -- to depict energy and gems. We concentrate mainly on the African continent and we have basically changed the group from a diamond-mining group to a cross-border resource group throughout Africa. We basically are now in 16 African countries on the continent. In each one of these countries we are in either mining or midstream oil, upstream or downstream oil or we then cover that by backing it up with logistics and infrastructure division in each of these countries.

WSR: Perhaps you could expand a bit on some of your projects and operations? At what stages are the drilling, development, etc.?

ENM: In the mining division, by taking over the existing DiamondWorks assets, we brought the Koidu mine into production in Sierra Leone. The Koidu mine consists of two kimberlite pipes with a resource of roughly 3.6 million tons of gravel with the average grade of roughly 55 carats per hundred tons. We brought this mine into operation beginning of this year. We did that in record time, in nine months -- basically bringing it to a trial and bulk mining stage during this year, 2004. We have proven all the grades. In other words, the historical grades that were there for us to work from have now been proven so we are in the process of opening up pipe one and while opening pipe one we are processing and mining pipe two. From January, we would be basically mixing the two productions from pipe one and two and this would give us the optimal grade that we are seeking, which is roughly 65 carats per hundred tons. We have also proven the price or the value per carat, which has come in at roughly $225 a carat, so we have a very robust kimberlite diamond project. That was the first project we had undertaken and due to our performance on the Kuydo kimberlite mines, we were also awarded the Tonga Fields, which is a diamond asset that used to belong to Rex Diamonds. Due to the war in Sierra Leone the rights lapsed, these rights went out to tender and we were successful in obtaining the rights to the Tonga Fields, which we were going to bulk mine and trial mine during the course of 2005. The second country where we are in diamonds is the Central African Republic where we roughly own just under 28,000 square kilometers of alluvial diamond mines or concessions. We have commenced bulk mining and trial mining on one of our concessions. This has proven to be somewhat robust at this stage where we've just mined our first 1,400 carats of diamonds at the value of just over $290 a carat. So we hope to continue our exploration in the Central African Republic and should be in production on A mine, in other words, the first property within 24 months from now in the CAR. Going along with diamond mining we also have rights in Angola. We own the Yetwene Mine and the Luo Mine in Angola. These two mines were producing when we took over DiamondWorks. However, due to security reasons and the political instability at the time, we decided to put these on care and maintenance and called for force majeure. We are now basically looking at the return of either Yetwene or the Luo Mine subject to negotiations on our terms and conditions with the Angolan government. We are looking at various gold and platinum projects throughout the continent in two countries to be exact, and we should be ready to make the announcement of a gold and platinum exploration play in the next three to six months. That basically covers the mining activities on the continent at this stage.
The company's other very big target is obviously oil, and I've divided it for you into downstream, midstream and upstream. I will talk about our midstream and downstream business. That midstream and downstream is where we believe we can add value by basically supplying the infrastructure, i.e., tanks, storage facilities and pipelines to landlocked African countries. By doing this we cut the cost of transportation of the fuel from the ports and we believe if we control the pipeline and storage facilities, we ultimately control the supply of fuel into these countries. We have been very successful in Malawi, which is landlocked. We have been awarded a 12-year contract to supply fuel and storage facilities of 70,000 square cubic meters, which means that we will be holding the country's strategic reserves and also putting in a pipeline from the Ncala Corridor to Malawi to deliver this fuel. This is roughly a 700-kilometer pipeline. The second pipeline and storage facilities we are involved in is in Nigeria, in Lagos, which will be the first privately owned storage facilities in the Lagos Port. This means we are the deepest berth outside the government where we can handle 30,000-ton tankers. And by doing so we cut out the double handling of the vessels offshore to be discharged with smaller vessels. This project is under construction and we should be operational by June or July of next year. We have other projects we are working on as final preferred bidders in terms of pipelining infrastructure, but we have been awarded right now the Benin contract. This makes us the sole supplier for Benin out of the same basically midstream contract arrangements where we basically receive the goods into storage tanks and distribute them into the country. So our target in midstream is really much planned out throughout the continent and we are actively working in another three countries in terms of pipeline projects and storage facilities. In Kenya we have a license to import fuel. We have commenced by taking over an ethanol plant, which makes alcohol out of molasses, sugar cane. This would be blended into premium fuel and this would be our first venture into Kenya. If this proves successful, which our plant comes into operation in the next week or so, we would then be maximizing our capacity at this plant and reducing the imports of fuel into Kenya. In other words, by producing power energy or power alcohol as it's called, to blend into the fuels, we would go to maximum capacity of 250,000 liters a day, and this would decrease the imports tremendously. On the upstream business and I'm just giving you our major targets and major projects. We acquired a company called Gulf of Guinea Petroleum Corporation. We acquired 51% of this company, which is a Montreal Canada company, which concentrates on marginal proven oil fields in West Africa. We did it from a strategic point of view where we believe that if we're going to be supplying so much downstream we should have our own upstream. These fields are manageable. They're marginal in the sense that the major oil companies look at oil blocks that are 500 million barrels and bigger and these are fields that the major companies have proven but don't meet the market criteria, i.e., 500-million barrels. So in the past year, GGPC has acquired the EOV Field in Gabon and is in the process of acquiring another field in Congo Brazzaville and we should see ourselves going into upstream production in the next eight to 10 months at roughly 10,000 barrels a day. We have been expanding on our upstream acreage in terms of exploration and proven fields and we will be in the position to announce another two major fields with discoveries in the next 30 to 60 days. We are able to do this by having our own logistics and infrastructure throughout Africa where we operate, i.e., the 16 countries that I mentioned earlier. We are able to enter a lot cheaper than outsiders that don't know the African continent and thereby save a lot of money and do our own supplies and logistics, our own operations. This has proven to be successful in the sense that we have turned a complete dead group of companies, in terms of finances, to a profitable situation. And we believe that in the coming 12 to 24 months the genuine potential of cash flow generation in this group will be proven, which will be a tremendous advantage from where it has been in the past.