Africa Oil Business News

Wed04132016

Last update11:28:10 AM

Afren plans further drilling in three Nigerian offshore fields

United Kingdom-listed independent oil and gas producer, Afren, said it planned to begin further development drilling at its Nigerian offshore Ebok, Okwok and Okoro oil fields in the third quarter (Q3) of the year in a bid to ramp up oil reserves and production.

The company, in its interim management statement for the first quarter, said the installation of the central fault bloc extension platform had started on Ebok and was expected to be completed by the end of the second quarter of 2014, with development drilling planned for Q3 targeting additional reservoirs in the bloc.

The field development plans for the Okoro and Okwok were approved by the Nigerian authorities, said Afren, as “the Okwok wellhead jacket has been fabricated and is currently in transit to the Okwok field area, with platform installation to be completed in Q2 2014 prior to development drilling planned for Q3 2014.”

Osman Shahenshah, CEO of Afren plc, said: “Afren continues to deliver operationally on all fronts with revenues in Q1 2014, of $269 million and operating cash flow of $169 million. We are moving forward with the play opening Ogo discovery and elsewhere development drilling is on track.”

The company’s focus remains on allocating its capital to the highest return projects, which is expected to provide significant production and cash flow growth, while it continues to de-risk its unprecedented exploration opportunity set, he said.

Afren said Q1 revenue dropped by 30 percent year-on-year to $269 million due to “reduced share of production and liftings from the Ebok field following cost recovery.”

Profit however, rose to $73 million compared with $28 million in the same period last year, bolstered by a five-year tax exemption period granted the company on the Ebok field.

Afren reported a continued strong operating performance with first quarter net production at 35,465 barrels of oil per day (bpd), in line with expectations.

Afren said in March that it expects gross oil production to rise to 62,000bpd in 2014 with the additional output from the three fields and from onshore Oil Mining Lease (OML) 26, which Afren and its joint-venture partners bought from Shell in 2012.

On OML 26, we expect the rig to arrive in June with a view to drilling three wells in the second half of 2014 (two producers and one water injector), the company said.

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