ADM Energy plc (AIM: ADME), an oil and gas investing company quoted on AIM, notes that Panoro Energy ASA (“Panoro”) (OSE Ticker: PEN), an independent exploration and production company, has agreed to sell 100% of its ownership in OML 113 to PetroNor E&P Limited (“PetroNor”) (OSE Ticker: PNOR), an independent oil and gas exploration and production company with a focus on production, development and exploration assets across sub-Saharan Africa (the “Transaction”).
Panoro holds a 6.502% participating interest, with 16.255% cost bearing interest, representing an economic interest of 12.1913% in OML 113. PetroNor has agreed to acquire Panoro’s interest in OML 113 for $10 million, to be paid in new PetroNor shares, with a contingent future payment of up to $25 million based on future gas production volumes. The Transaction is conditional on execution and conclusion of an agreement with the operator of OML113, expected to conclude in the coming weeks, and upon the authorisation of the Nigerian Department of Petroleum Resources and the consent of the Nigerian Minister of Petroleum Resources.
In an announcement from PetroNor on 21 October 2019, PetroNor stated its rationale for the Transaction was to: “become a technical operator of a de-risked development project with significant upside potential”, giving it the “opportunity to leverage PetroNor’s technical experience to progress [the] Aje project and deliver near-term increased commercial recovery of hydrocarbons.”
Osamede Okhomina, CEO of ADM Energy, said: “PetroNor entering the Aje project and taking a lead role in its future development is a strong endorsement of the viability of the asset and its significant potential upside. With its extensive offshore technical experience in oil and gas exploration, development and production, PetroNor can help bring near-term production growth and take Aje to the next stage of its development.”
ADM Energy holds a 5% equity investment in the Aje field in OML 113, which covers an area of 835 sq km offshore Nigeria. Aje has multiple oil, gas and gas condensate reservoirs in the Turonian, Cenomanian and Albian sandstones with five wells drilled to date. It currently has two producing wells, Aje-4 in the Cenomanian and Aje-5 in the Turonian.