LEKOIL, an Africa focused oil and gas exploration and production company is set to deepen its growth and strategic investment in Nigeria in 2019. The management of the company made this disclosure in a statement that accompanied its 2018 financial report.
According to the 2018 financial report, production at the Otakikpo marginal field averaged approximately 5,345 bopd, while strategic decisions and steps towards increasing production commenced. At the Otakikpo marginal field, Phase Two preparations for development commenced with the acquisition of 3D seismic data acquisition and interpretation, while an updated Competent Person’s Report (CPR) has nearly been completed.
Apart from investment in the Otakipko marginal fields, LEKOIL has made further investment in OPL325 and its lawsuit connected to OPL 310 has been withdrawn to enable engagement with partner, Optimum Petroleum Development Limited (“Optimum”), and the regulator, to conclude agreements and resolve all outstanding issues.
Technical Evaluation on OPL325 has been completed with 11 prospects and leads estimated to contain potential gross aggregate Oil-in-Place volumes of over 5,700 mmbbls (un-risked, Best Estimate case) identified. After finalising terms for a Production Sharing Contract on the block, LEKOIL intends to farm-down a portion of its 62 per cent. working interest following a detailed prospect/lead risking study.
Though LEKOIL posted a loss of $7.8 million in the 2018 financial year, as against profit of $6.5 million in 2017, there are plans to ramp up production at the Otakipko marginal fields to approximately 15,000 to 20,000 bopd. Subject to agreement on funding with partners, plans are underway for a three to five well drilling programme, with the aim of meeting the production target.
According to Olalekan Akinyanmi, Chief Executive Officer, LEKOIL “The priority for 2019 is to grow production volumes at Otakikpo through Phase Two development (subject to funding) to reach gross volumes of 15,000 to 20,000 bopd. The first step has already occurred, with 3D seismic data acquisition and interpretation now completed.
“We also continue to advance towards the start of the appraisal drilling programme on Ogo in OPL 310. We will work with our joint venture partner, Optimum, to negotiate agreements that will allow us to make progress on the block, after securing all relevant regulatory extensions and approvals,” Akinyanmi said.
“The next year should therefore provide key catalysts for value appreciation for shareholders as we move forward in building a leading Africa-focused exploration and production business.
LEKOIL has an ambition of becoming the world’s leading exploration and production company focused on Africa. In realising this vision, the company seeks to maximise value for stakeholders in a sustainable manner, by operating with integrity and leveraging local resources – to the benefit of the countries and communities in which it operates.