http://www.xomba.com/nigeria_marginal_field_review_bid_round_2009
We will ask the awardees to provide field development status update for all the 24 marginal fields awarded to 30 local companies in 2003”, say sources familiar with the situation. Those who have made inadequate efforts to develop their fields would have them revoked. Those fields will be put-with other fields- in a new bid round coming up later in 2009.
Friday, February 13, 2009
Monday, February 9, 2009
Feb 9th - successfully raised over $450 million
The Company has successfully raised over $450 million in attractively priced debt and loan notes since IPO. On the face of it, although this figure appears high in comparison to the Company’s current market capitalisation, the majority of this debt is ringfenced around the assets in a reserves based lending structure.
Of the Company’s current $430 million debt, only a $50 million senior un-secured facility and the $45 million loan notes (at labor + 2%) are non-ringfenced to the assets.
The reserve based lending facilities are amortised over a 5 year term. The facility amounts available (which have been drawn) are calculated based on the fields ability to service the debt under a very conservative banking case (which is typically below the 1P production forecast) and low oil price.
This ensures that the fields will generate sufficient net cashflow to service the debt even in a low case. It is worth noting that both Okoro and Cote d’Ivoire are performing substantially above the forecasts used for the purpose of determining the borrowing base, and are set to continue to do so, thereby ensuring that all debt obligations (reserves based or otherwise) can be comfortably met now and in the future with significant residual free cash remaining for the company to fund further growth and expansion.
As part of its reserve based lending facilities, the Company has strategically hedged a certain amount of production to further ensure that debt service obligations can be met and also to comply with certain debt covenants.
The Company has hedged its oil production in Cote d’Ivoire out to the end of 2012 at an average floor price of $83/bbl, and at Okoro has hedged approximately 17% of production to the end of 2010 at an average floor price of approximately $55/bbl. 2009 will be a year of peak production at Okoro, with the field currently producing profitably at circa 22,000 b/d the field is significantly out-performing pre production start-up estimates of 15,000 b/d (circa +47% out-performance vs guidance).
Coupled with a stable 5,200 boe/d production in Cote d’Ivoire the Company is now producing circa 27,000 boe/d. The Company is therefore strongly cash generative, and 2009 will see Afren pay down a further $105 million in debt principal amounts, thereby reducing the forecast end 2009 debt position to approximately $325 million (including the loan notes), approximately $280 million excluding the loan notes
Of the Company’s current $430 million debt, only a $50 million senior un-secured facility and the $45 million loan notes (at labor + 2%) are non-ringfenced to the assets.
The reserve based lending facilities are amortised over a 5 year term. The facility amounts available (which have been drawn) are calculated based on the fields ability to service the debt under a very conservative banking case (which is typically below the 1P production forecast) and low oil price.
This ensures that the fields will generate sufficient net cashflow to service the debt even in a low case. It is worth noting that both Okoro and Cote d’Ivoire are performing substantially above the forecasts used for the purpose of determining the borrowing base, and are set to continue to do so, thereby ensuring that all debt obligations (reserves based or otherwise) can be comfortably met now and in the future with significant residual free cash remaining for the company to fund further growth and expansion.
As part of its reserve based lending facilities, the Company has strategically hedged a certain amount of production to further ensure that debt service obligations can be met and also to comply with certain debt covenants.
The Company has hedged its oil production in Cote d’Ivoire out to the end of 2012 at an average floor price of $83/bbl, and at Okoro has hedged approximately 17% of production to the end of 2010 at an average floor price of approximately $55/bbl. 2009 will be a year of peak production at Okoro, with the field currently producing profitably at circa 22,000 b/d the field is significantly out-performing pre production start-up estimates of 15,000 b/d (circa +47% out-performance vs guidance).
Coupled with a stable 5,200 boe/d production in Cote d’Ivoire the Company is now producing circa 27,000 boe/d. The Company is therefore strongly cash generative, and 2009 will see Afren pay down a further $105 million in debt principal amounts, thereby reducing the forecast end 2009 debt position to approximately $325 million (including the loan notes), approximately $280 million excluding the loan notes
Wednesday, February 4, 2009
My Investor Relations Update - 4th Feb
Thank you for your recent enquiry submitted through the Afren website.
In response to your question we commenced appraisal drilling at Ebok on 24th November 2008 using the Trident IV jack-up rig.
We completed appraisal drilling operations in line with our stated timetable on 1 February 2009.
We are pleased to confirm that we successfully achieved all of our pre-drill objectives which included establishing the areal distribution of the reservoir, reservoir properties and acquiring a full suite of technical data. Interpretation and analysis of the appraisal results is ongoing and we are awaiting the independent analysis and certification of this, after which a further announcement will be made on this very exciting project and the timing of the development.
You will note from the Okoro development that the Company has always maintained a conservative approach to releasing robust information to our shareholders.
Furthermore we are pleased to provide you with an update on operations and performance across the rest of the portfolio:
Ø The group is producing profitably at a total rate of approximately 27,000 working interest boepd of oil, gas and natural gas liquids.
Ø Okoro is now producing at rates of 22,000 bopd, marking a significant (+47%) out-performance versus pre-development guidance of 15,000 bopd.
Ø Production in Cote d'Ivoire remains stable at approximately 5,200 working interest boepd. Since Afren assumed control of the assets gross production has increased by circa 700 boe/d.
Ø The company remains fully funded through its budgeted work programme and has a robust financial platform and strong capital discipline.
Ø Afren will participate in one firm exploration well, at the La Noumbi permit in Congo, during H1 2009 and is continuing to aggressively pursue several highly attractive acquisition opportunities.
On fundamentals the company has never been stronger or better positioned to capitalise on and deliver materially value accretive portfolio growth.
Should you have any further questions please do not hesitate to contact us.
In response to your question we commenced appraisal drilling at Ebok on 24th November 2008 using the Trident IV jack-up rig.
We completed appraisal drilling operations in line with our stated timetable on 1 February 2009.
We are pleased to confirm that we successfully achieved all of our pre-drill objectives which included establishing the areal distribution of the reservoir, reservoir properties and acquiring a full suite of technical data. Interpretation and analysis of the appraisal results is ongoing and we are awaiting the independent analysis and certification of this, after which a further announcement will be made on this very exciting project and the timing of the development.
You will note from the Okoro development that the Company has always maintained a conservative approach to releasing robust information to our shareholders.
Furthermore we are pleased to provide you with an update on operations and performance across the rest of the portfolio:
Ø The group is producing profitably at a total rate of approximately 27,000 working interest boepd of oil, gas and natural gas liquids.
Ø Okoro is now producing at rates of 22,000 bopd, marking a significant (+47%) out-performance versus pre-development guidance of 15,000 bopd.
Ø Production in Cote d'Ivoire remains stable at approximately 5,200 working interest boepd. Since Afren assumed control of the assets gross production has increased by circa 700 boe/d.
Ø The company remains fully funded through its budgeted work programme and has a robust financial platform and strong capital discipline.
Ø Afren will participate in one firm exploration well, at the La Noumbi permit in Congo, during H1 2009 and is continuing to aggressively pursue several highly attractive acquisition opportunities.
On fundamentals the company has never been stronger or better positioned to capitalise on and deliver materially value accretive portfolio growth.
Should you have any further questions please do not hesitate to contact us.
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