Energy

VAALCO Energy’s stock rises to historic highs after Q3 earnings and revenues surpass estimates

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VAALCO Energy, the independent company operating oil & gas projects offshore Central Africa, has just reported a strong net income of $31.7m for Q3 2021.

The company sold 741,000 barrels of oil this past quarter, up 15% from Q2 this year, and benefited from a realised crude oil price of $73.02/bbl.

As a result, VAALCO Energy’s shares were up almost +7% today and +75% since early January. VAALCO Energy’s stock is currently trading at $3.46/share. The company is listed on the New York Stock Exchange and completed a dual listing on the London Stock Exchange in September 2019, in a bid to access additional sources of capital.

Source: Yahoo Finance

The company’s shares passed the $3 threshold in February this year, a level they had not reached since July 2018. They are now trading at a new 5-year high that confirms its solid performance after it doubled its net interest production this year.

VAALCO Energy’s flagship asset is its Etame Marin permit offshore Gabon, where it has been producing oil since September 2002. To keep developing the fields, it recently consolidated its interests in the licence by acquiring Sasol’s 27.8% working interest, concretely doubling its total net production and reserves in the process.

Source: VAALCO Energy

Bringing Gabonese Operations to the Next Level

VAALCO Energy is currently engaged in significant expansion of its operations at Etame offshore Gabon. Following the completion of a 3D seismic acquisition in December 2020, it is starting a new drilling campaign on the block.

The 2021/2022 campaign will target at least two development wells and two appraisal wells to add anywhere between 7,000 and 8,000 bopd of additional production. The Etame 8HST, the first well of the 2021/2022 drilling program, should be spudded in early December 2021.

Meanwhile, VAALCO is expected to replace the FPSO Petroleo Nautipa, whose contract expires in September 2022, by a floating, storage and offloading (FSO) unit to cut costs and maximise operations.

The company is also betting on additional exploration potential around Etame and provisionally secured a 37.5% non-operated interest in blocks G12-13 and H12-13 during Gabon’s 12th Licensing Bid Round that concluded in 2021. Both blocks’ areas surround the Etame complex and are now operated by BW Energy.

Achieving First Oil in Equatorial Guinea

VAALCO Energy has also completed the drilling feasibility study for a standalone development of the Venus discovery on Block P offshore Equatorial Guinea and is currently proceeding to a field development concept.

The project is expected to rely on a floating, storage and offloading (FSO) unit with a platform on the shelf (jack-up production unit). The PSC for Block P provides for a development and production period of 25 years from the date of approval of a development and production plan.

An indicative timeline given by VAALCO in 2021 notably expects development drilling at Venus to start in October 2024 to achieved first oil in January 2025.

Full details on VAALCO Energy’s operational and financial performances along with the company’s projects offshore Gabon and Equatorial Guinea are available in the “Companies” and “Projects” section within your Hawilti+ research terminal.

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GL Africa Energy signs agreement for a new 250 MW LNG-to-power plant in Mozambique

Janus Continental Group’s subsidiary Great Lakes Africa Energy (GL Africa Energy) has signed yesterday a Concession Agreement with Mozambique’s Energy Minister to finance, build and operate a 250 MW LNG-to-power plant in the country’s Nampula province. “The deal signals the start of a three-part phased investment. Initial phase will create 50MW capacity within 16 months. The second and third phases will add 200MW in total and will be completed within 24 months,” GL Africa Energy said in a statement shared with Hawilti. This will be GL Africa Energy’s biggest investment to date, developed under a 30-year public-private partnership with state-utility Electricidade de Moçambique (EDM) as the off-taker. Electricity generated will then supply the entire Nacala corridor in Northern Mozambique. The $400m project has been in preparations for a while and was already subject to the signing of a Memorandum of Understanding (Mou) between both parties in May 2018. This had notably followed the result of Mozambique’s Rovuma Basin domestic gas tender, the results of which were announced in January 2017. The facility will be supplied from gas coming from Mozambique’s Rovuma Basin, where Eni’s 3.4 million tonnes per annum (mtpa) Coral South FLNG is expecting to achieve first gas next year. This is also where TotalEnergies is developing a 12.88 mtpa onshore LNG export terminal, where it expects to resume works in 2022 following the declaration of Force Majeure earlier this year. While the Coral South FLNG does not have a domestic gas allocation, Mozambique LNG has 100 MMscfd allocated to the domestic market. A Growing Gas-to-Power Market Gas-to-power in Mozambique is a relatively new industry but growing rapidly. The country’s first facilities emerged from the monetizing of royalty gas from the Mozambique-Secunda Gas Pipeline that has been exporting onshore gas to South Africa since 2004. In 2015, three facilities were commissioned including the 175 MW Central Térmica de Ressano Garcia, or CTRG, currently owned by Azura Power and EDM, Gigawatt’s 100 MW Ressano García facility and Kuvaninga’s 40.29 MW gas-to-power plant. EDM’s 110 MW Maputo facility followed in 2018. More recently, Globeleq has embarked on the development of the 420 MW Central Térmica de Temane (CTT) to monetise additional gas from Temane and Pande onshore Mozambique. The project is expected to be commissioned by 2025 and has already secured funding and approvals. Meanwhile, a consortium of TotalEnergies, the Gigajoule Group and Matola Gas has embarked on a very ambitious and integrated gas-to-power project in Maputo. It notably includes the deployment of a floating, storage and regasification unit (FSRU) in the city’s harbour to import gas and support the development of the new 2,000 MW Central Térmica de Beluluane (CTB). FID is expected in 2022, with Phase 1 targeting 500 MW. Details on Mozambique’s gas-to-power projects are available in the “Projects” section within your Hawilti+ research terminal.

Invictus Energy completes 2D seismic over Cabora Bassa onshore Zimbabwe

Invictus Energy has completed the acquisition of 839.3km of high-resolution 2D seismic data as part of its Cabora Bassa 2021 (CB21) survey onshore Zimbabwe. This significantly exceeds the company’s minimum work programme of 300km of 2D seismic data over its Special Grant 45 71 (SG 4571) license that runs to June 2024. 402.2km of data was acquired over  SG 4571, where lies the Muzarabani prospect that Invictus Energy will drill next year. The remaining 437.1km of contiguous data was acquired in an existing application area. “The seismic data processing and interpretation is ongoing and once completed will enable us to identify and mature additional prospects and leads. The better imaging over the giant Muzarabani structure is very encouraging and once the interpretation of the full dataset is completed, we expect to refine the location for the basin opening Muzarabani-1 well which is scheduled to be drilled in 1H 2022,” Invictus Energy Managing Director Scott Macmillan commented. Invictus has an 80% equity stake in SG4571 via its subsidiary Geo Associates (Private) Limited. The license was granted for three years back in August 2017 and is currently in its second exploration period. Details on the Cabora Bassa Project are available in the “Projects” section within your Hawilti+ research terminal.