TIDMVOG
RNS Number : 3925A
Victoria Oil & Gas PLC
02 February 2022
02 February 2022
Victoria Oil & Gas Plc
("VOG" or the "Company")
Q4 2021 Operational Update
Victoria Oil & Gas Plc, whose wholly owned subsidiary, Gaz
du Cameroun S.A. ("GDC"), is the onshore gas producer and
distributor with operations located in the port city of Douala,
Cameroon, is pleased to provide shareholders with a brief
operations update for the fourth quarter of 2021.
SUMMARY
-- Sales : Average daily gross gas sales rate for the quarter of
5.3 MMscf/d (up 6.0% on Q3 21: 5.0 MMscf/d) of natural gas, plus
gross 5,584 bbls (Q3 21: 3,800 bbls) condensate was shipped to
customers.
-- Logbaba Performance : The field has been meeting the demand
using two of the three wells at any one time, with Well La-108
alternating with Well La-107.
-- Matanda : Following the selection of a suitable wellsite to
drill a vertical well into the Marula prospect on Government-owned,
late-life plantation lands, stakeholder engagement continued, and
the preparation of site access roads commenced.
-- Litigation: Certain of the non-monetary claims in the ICC
arbitration with RSM Production Corporation ("RSM") have been
settled consistent with the UNCITRAL arbitration settlement
agreement, previously announced on 29 September 2021. The settled
non-monetary claims resolve several prospective accounting
issues.
Roy Kelly, Chief Executive of Victoria Oil & Gas, commented :
"We are very pleased with the robust quarter that GDC achieved,
despite a greater than expected number of maintenance shutdowns for
its customers. Following the end of the quarter, 2022 has started
very well with strong demand shown in the market.
"I am pleased we could settle those non-monetary claims with a
prospective impact in the ICC arbitration, and I am again grateful
to RSM for their continued and constructive engagement on
this."
LOGBABA UPDATE
Quarterly Production
GDC continues to safely produce and sell natural gas to a
variety of customers in the Douala area, who would otherwise be
burning liquid fuels. Quarterly gross and net gas sales and
condensate shipments at Logbaba are as follows (amounts shown in
bold represent net gas and condensate sales attributable to GDC
(57%)):
Q4 2021 Q3 2021
Gas sales (MMscf)
--------------------- ------ ------ ------ ------
Thermal 265 465 247 434
------ ------ ------ ------
Industrial power 14 25 16 28
------ ------ ------ ------
Total (MMscf) 279 490 263 462
------ ------ ------ ------
Daily average gross
gas sales rate
(MMscf/d) 5.3 5.0
-------------- ----------------
Condensate shipped
(bbls) 3,183 5,584 2,166 3,800
------ ------ ------ ------
Logbaba Field Performance
The Logbaba field has now produced a cumulative 21 Bcf of
natural gas, having passed the 20 Bcf milestone in July 2021. Well
La-108 was shut in on 25 December 2021 to allow Well La-107 to
commence production. Well La-108 was closed as both wells cannot be
used simultaneously whilst their wellhead flowing pressures are so
far apart. As before, the Company will use the shut-in to monitor
the Well La-108 pressure build-up to gain more understanding of the
reservoir and well performance. At the time of writing, the Well
La-108 shut-in pressure continues to build up.
Customers
GDC's online customer count remained around 30 for the period,
though several customers used the period for maintenance
shutdowns.
During January 2022, demand was high, reaching a mid-week peak
of 6.8 MMscf/d gas sales (unaudited) on one occasion, the highest
for three years.
Look-ahead: GDC is forecasting a growth in demand of 10-20% in
2022 (compared to demand in 2021), from both organic and inorganic
growth. Cameroon is hosting a major sporting event in Q1 and the
Company expects this to have a positive effect on sales in January
and February. GDC will continue to exercise capital discipline and
look to reduce costs where possible.
MATANDA UPDATE
Civil engineering work on site access continued during the
period, occasionally hampered by the weather. The Company continues
to market the Matanda Farm-Out opportunity.
Towards the end of the period, an invitation to tender was
issued and (post-period) seven rigs have been offered, six of which
are in neighbouring countries, one of which is in Europe.
La-108 UNSURANCE CLAIM
The Company continues to pursue its insurance claim relating to
the 2017 well control incident, now with the assistance of a
leading international law firm who specialises in this area.
WEST MED UPDATE
Whilst we have not received a binding offer at this stage, we
continue to receive an encouraging number of enquiries about the
West Med asset from credible and credit-worthy oil and gas
companies, no doubt helped by elevated oil prices (the West Med
discovery being light oil/condensate).
LITIGATION UPDATE
ICC Case NO. 23991/MK
Whilst the ICC has yet to make its award, the parties have now
settled the prospective non-monetary elements of the arbitration
and discussions with RSM continue to resolve the monetary claims
and remaining retrospective non-monetary claims.
For further information, please visit www.victoriaoilandgas.com or contact:
Victoria Oil & Gas Plc
Roy Kelly/Rob Collins Tel: +44 (0) 20 7921 8820
Strand Hanson Limited (NOMAD)
Rory Murphy/James Dance Tel: +44 (0) 20 7409 3494
Shore Capital Stockbrokers Limited (Broker)
Mark Percy/Toby Gibbs Tel: +44 (0) 207 408 4090
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