VANCOUVER, BC, March 28,
2022 /CNW/ - (TSX: AOI) (Nasdaq-Stockholm: AOI)
– Africa Oil Corp. ("AOI", "Africa Oil" or "the Company") is
pleased to announce that it has received a dividend from Prime Oil
and Gas Cooperatief UA ("Prime"). The Company has a 50%
shareholding in Prime. View PDF
Prime has distributed a $200
million dividend with a net payment to Africa Oil of
$100 million related to its
shareholding. Since acquiring its 50% interest in Prime for a cash
consideration of $520 million in
January 2020, Africa Oil has received
11 dividends from Prime for a total amount of $500 million, representing 96% of the cash
consideration paid.
At year-end 2021, Prime's cash and debt positions net to Africa
Oil's 50% shareholding were $258.9
million and $508.4 million
respectively. These compare with corresponding cash of
approximately $70 million and debt of
$912.5 million at the time of Prime
deal closing in January 2020.
The Company's year-end 2021 working interest (W.I.) Proved plus
Probable ("2P") reserves of 72.8 million barrels of oil equivalent
("MMboe") compare to its year-end 2019 2P reserves of 70.9
MMboe1,2,3. These reserves are all attributed to Africa
Oil's 50% shareholding in Prime. The Company achieved 2P reserves
replacement ratios of 114% and 102% in 2020 and 2021
respectively.
Keith Hill, Africa Oil's
President and CEO, commented: "We have made a strong start to this
year with a debt-free corporate balance sheet, the implementation
of a base dividend policy for Africa Oil's shareholders and the
announcement of a significant light oil discovery, offshore
Namibia. I am also pleased that
after two strong years of production performance and receiving
$500 million in dividends from
Prime, our year-end 2021 2P reserves are higher than the 2P
reserves base at the time of our Prime acquisition. This
underscores the excellent quality of these assets."
NOTES
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1.
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These reserves
estimates are based on independent reserves evaluations, in
accordance with Canadian National Instrument 51-101 – Standards for
Oil and Gas Activities ("NI 51-101") and the Canadian Oil and Gas
Evaluation Handbook ("COGE Handbook"). Please refer to 'Advisory
Regarding Oil and Gas Information' on the next page for further
details.
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2.
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Africa Oil's reserves
are comprised of light and medium crude oil and conventional
natural gas.
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3.
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Please refer to the
Company's corresponding NI 51-101 reports that are included in 2019
and 2021 Annual Information Forms for further details on the
Company's reserves. These include net entitlement reserves
calculated using the economic interest methodology that include
cost recovery oil, tax oil and profit oil and is different from
working interest reserves that are calculated based on project
volumes multiplied by effective working interest in each
license.
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4.
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All dollar amounts are
in United States dollars unless otherwise indicated.
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Africa Oil Corp. is a Canadian oil and gas company with
producing and development assets in deepwater Nigeria; development assets in Kenya; and an exploration/appraisal portfolio
in Africa and Guyana. The Company is listed on the Toronto
Stock Exchange and on Nasdaq Stockholm under the symbol
"AOI".
This information is information that Africa Oil Corp. is obliged
to make public pursuant to the EU Market Abuse Regulation and the
Swedish Financial Instruments Trading Act. The information was
submitted for publication, through the agency of the contact person
set out below on March 28, 2022 at
5:30 p.m. ET.
Advisory Regarding Oil and Gas Information
The term MMboe (millions of barrels of oil equivalent) are used
throughout this press release. Such term may be misleading,
particularly if used in isolation. Year-end 2021 and 2019 reserves
estimates are based on a conversion ratio of six thousand cubic
feet per barrel of oil equivalent (6 Mcf: 1 boe), which is based on
an energy equivalency conversion method primarily applicable at the
burner tip and does not represent a value equivalency at the
wellhead. Given that the value ratio based on the current price of
crude oil as compared to natural gas is significantly different
from the energy equivalency of 6:1, utilizing a conversion on a 6:1
basis may be misleading as an indication of value.
Year-end 2021 2P reserve estimate included in this press release
was evaluated by RISC in accordance with NI 51-101 and the COGE
Handbook, effective December 31,
2021. RISC's report was prepared using Brent oil price
forecast of ($/bbl): 2022 - $77.1;
2023 - $73.3; 2024 - $63.0; 2025 - $64.6; 2026 - $66.2; 2027 and beyond escalation rate of
2.5%.
Year-end 2019 2P reserve estimate included in this press release
was evaluated by Lloyds Register ("LR") in accordance with NI
51-101 and the COGE Handbook, effective December 31, 2019. LR report was prepared using
Brent oil price forecast of ($/bbl): 2020 - $63.5; 2021 - $65.0; 2022 - $67.0; 2023 - $69.0; 2024 - $70.4; 2025 and beyond escalation rate of
2.0%.
The reserves estimates presented in this press release have been
evaluated by RISC and LR in accordance with NI 51-101 and the COGE
Handbook. The reserves presented herein have been categorized
accordance with the reserves and resource definitions as set out in
the COGE Handbook. The estimates of reserves in this press release
may not reflect the same confidence level as estimates of reserves
for all properties, due to the effects of aggregation.
There is no assurance that the forecast prices will be attained
and variances could be material. The recovery and reserves
estimates of crude oil, natural gas liquids and natural gas
reserves provided herein are estimates only and there is no
guarantee that the estimated reserves will be recovered. Actual
crude oil, natural gas and natural gas liquids reserves may be
greater than or less than the estimates provided herein.
Reserves are estimated remaining quantities of petroleum
anticipated to be recoverable from known accumulations, as of a
given date, based on the analysis of drilling, geological,
geophysical, and engineering data; the use of established
technology; and specified economic conditions, which are generally
accepted as being reasonable. Reserves are further classified
according to the level of certainty associated with the estimates
and may be sub-classified based on development and production
status. Proved Reserves are those quantities of petroleum, which,
by analysis of geoscience and engineering data, can be estimated
with reasonable certainty to be economically producible from a
given date forward, from known reservoirs and under existing
economic conditions, operating methods and government regulations.
Probable Reserves are those additional quantities of petroleum that
are less certain to be recovered than Proved Reserves, but which,
together with Proved Reserves, are as likely as not to be
recovered. Possible Reserves are those additional reserves that are
less certain to be recovered than probable reserves. It is unlikely
that actual remaining quantities recovered will exceed the sum of
the estimated proved plus probable plus possible reserves.
Forward Looking Information
Certain statements and information contained herein constitute
"forward-looking information" (within the meaning of applicable
Canadian securities legislation). Such statements and information
(together, "forward looking statements") relate to future events or
the Company's future performance, business prospects or
opportunities.
All statements other than statements of historical fact may be
forward-looking statements. Any statements that express or involve
discussions with respect to predictions, expectations, beliefs,
plans, projections, objectives, assumptions or future events or
performance (often, but not always, using words or phrases such as
"seek", "anticipate", "plan", "continue", "estimate", "expect,
"may", "will", "project", "predict", "potential", "targeting",
"intend", "could", "might", "should", "believe" and similar
expressions) are not statements of historical fact and may be
"forward-looking statements". Forward-looking statements involve
known and unknown risks, ongoing uncertainties and other factors
that may cause actual results or events to differ materially from
those anticipated in such forward-looking statements. No assurance
can be given that these expectations will prove to be correct and
such forward-looking statements should not be unduly relied upon.
The Company does not intend, and does not assume any obligation, to
update these forward-looking statements, except as required by
applicable laws. Actual results may differ materially from those
expressed or implied by such forward-looking statements.
SOURCE Africa Oil Corp.