LEKOIL LIMITED: OPL 310 - Application for a Declaration regarding Ministerial Consent

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 LEKOIL LIMITED (LEK) 
LEKOIL LIMITED: OPL 310 - Application for a Declaration regarding 
Ministerial Consent 
 
27-March-2018 / 07:00 GMT/BST 
Dissemination of a Regulatory Announcement that contains inside information 
according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group. 
The issuer is solely responsible for the content of this announcement. 
 
27 March 2018 
 
       LEKOIL Limited 
 
       ("LEKOIL" or the "Company") 
 
   OPL 310 - Application for a Declaration regarding Ministerial Consent 
 
               Background 
 
       On 1 February 2013, Mayfair Assets and Trust Limited, a subsidiary of 
       LEKOIL, farmed into Afren Investments Oil and Gas (Nigeria) Limited's 
(AIOGNL) interest in OPL 310 for a 17.14 per cent participating interest and 
30 per cent economic interest, subject to Ministerial Consent from Nigeria's 
   Minister for Petroleum Resources. Ministerial Consent was granted for the 
               interest on 9 June 2017 
 
 On 31 July 2015, Afren plc ("Afren"), 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. On 1 December 2015, LEKOIL announced an 
 agreement with the administrator of Afren and Afren Nigeria Holding Limited 
  to acquire the shares of AIOGNL, which held a 22.86 per cent participating 
  interest in OPL 310. This interest was also subject to Ministerial Consent 
from the Minister for Petroleum Resources. The acquisition meant that LEKOIL 
      would hold a consolidated participating interest of 40 per cent and an 
   economic interest of 70 per cent in OPL310 and would become the technical 
 and financial partner of Optimum Petroleum Development Company ("Optimum"), 
        the operator and local partner in OPL310 which retains a 60 per cent 
               participating interest. 
 
An application for the transfer of the 22.86 per cent interest was duly made 
  by Afren Nigeria in January 2016. As the transaction was not undertaken on 
 the basis of an Assigned Interest in the oil block, approval by Optimum was 
 not required under the JOA between Optimum and Afren. In March 2016, LEKOIL 
  was notified by the Ministry of Petroleum Resources that the necessary due 
diligence exercise would be conducted that month. The due diligence exercise 
        did not take place and has not been rescheduled by the Department of 
               Petroleum Resources since then. 
 
               Application to the Court for a Declaration 
 
      Despite progressing exploration and appraisal activities on OPL 310 as 
 previously announced, LEKOIL has, to date, not received Ministerial Consent 
 for its acquisition of the additional 22.86 per cent interest in OPL 310 or 
 a satisfactory explanation of why such consent has not been forthcoming. As 
   a result, the Company has taken the decision to apply to the Federal High 
   Court for a declaration that is expected to expedite the consent process, 
  and preserve the unexpired tenure in the licence. The Company will provide 
 updates to the market as appropriate. The Company is represented by Fidelis 
               Oditah QC, SAN. 
 
        For further information, please visit www.lekoil.com [1] or contact: 
 
             LEKOIL Limited 
 
 Alfred Castaneda, Investor         [phone] 
                  Relations 
 
                                    [phone] 
       Lisa Mitchell, Chief 
          Financial Officer 
 
                     Strand Hanson Limited 
                    (Financial & Nominated 
                                  Adviser) 
 
                                             [phone] 
 
              James Harris / James Spinney 
                          / Ritchie Balmer 
 
    Mirabaud Securities LLP 
             (Joint Broker) 
 
                              [phone] / +44 
       Peter Krens / Edward             20 7878 3447 
                Haig-Thomas 
 
 BMO Capital Markets (Joint 
                    Broker) 
 
                                    [phone] 
  Jeremy Low / Neil Haycock 
             / Thomas Rider 
 
   Tavistock (Financial PR) 
 
      Simon Hudson / Barney         [phone] 
   Hayward / Charles Vivian 
 
 The information contained within this announcement is deemed by the Company 
       to constitute inside information as stipulated under the Market Abuse 
               Regulations (EU) No. 596/2014 ("MAR"). 
 
Technical Background on OPL310 
 
 In 2013, the first exploration well (Ogo-1) drilled by the OPL 310 partners 
    - then consisting of Optimum, LEKOIL and Afren - 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 1 December 2015, the Company announced an agreement with the 
administrator of Afren and Afren Nigeria Holding Limited to acquire the 
shares of AIOGNL, which held a 22.86% participating interest in OPL 310 for 
a total consideration of US$13 million. Post-acquisition, the Company holds 
a 40% working interest and 70% economic interest in the block, with AIOGL's 
22.86% working interest and 40% economic interest subject to Ministerial 
Consent. 
 
       -ends- 
 
ISIN:          KYG5462G1073 
Category Code: MSCH 
TIDM:          LEK 
LEI Code:      213800T6JMZ84UEF5C40 
Sequence No.:  5334 
 
End of Announcement EQS News Service 
 
669007 27-March-2018 
 
 
1: http://public-cockpit.eqs.com/cgi-bin/fncls.ssp?fn=redirect&url=cf18eb9b0cff2bfecacebb0696619578&application_id=669007&site_id=vwd_london&application_name=news 
 

(END) Dow Jones Newswires

March 27, 2018 02:02 ET (06:02 GMT)