TIDMAZO
RNS Number : 7690L
Azonto Petroleum Ltd
30 April 2015
Azonto Petroleum Ltd
Suite 5, 531 Hay Street
Subiaco, WA, 6008
Australia
Portland House, 8(th)
Floor
Bressenden Place
London SW1E 5BH
United Kingdom
Grégory Stoupnitzky
Jay Smulders
T: +44 (0)20 7042
8500
---------------------------
RFC Ambrian Limited
Nomad and Joint Broker
Samantha Harrison
T: +44 (0)20 3440
6800
---------------------------
GMP Securities Europe
LLP
Joint Broker
Rob Collins
Emily Morris
T: +44 (0)20 7647
2816
---------------------------
Buchanan
Financial PR London
Ben Romney
Gordon Poole
T: +44 (0)20 7466
5000
E: azonto@buchanan.uk.com
---------------------------
March 2015
Azonto Quarterly Activities Report
Recent Highlights
1. Steering Committee established between CI-Energies,
IPP contractor and VIOCO
2. Received bid for the Gazelle Facilities Engineering,
Procurement and construction contract
3. Maturation of block exploration prospects
4. Announcement of Strategic review including
potential sale of the Company's assets, merger,
or sale of the Company
Post period
5. Further cost-cutting measures resulting in
additional staff reductions
--------------------------------------------------------------
A message from the Managing Director - Grégory Stoupnitzky
Following the organizational changes announced in January, the
Board and the Management team have decided to further slim down the
organization consistent with our announced plans to seek a
strategic solution to the future of the Company. As a result, our
personnel count is now reduced to 5 full time employees, and
additional support from contractors as needs arise.
We continue to be in close discussions with CI-Energies, the
Ivorian State-owned utility company, in relation to the planned
independent power plant ("IPP") to be co-located in Grand Bassam,
next to Vioco's onshore gas processing plant.
CI-Energies recently signed a non-binding MOU with a reputable
international company which may finance, develop and operate the
IPP at Grand Bassam and upgrade the power line infrastructure for
the proposed Vioco integrated gas to power project. The intention
is for the scope and schedule for the IPP to be agreed by the end
of May 2015.
The ESIA environmental impact assessment report on the Grand
Bassam project site has been completed and, following a period of
public consultation, was submitted to the Côte d'Ivoire
Environmental Agency (ANDE) on 20th March 2015 with a view to
obtaining formal approval by the Ministry of Environment and
Sustainable Energy by mid-May 2015.
In relation to the construction of the offshore and onshore
elements of the Gazelle Project, a firm price proposal has been
received from Rosetti Marino; however the price does not reflect
the expected reduction of development costs. In order to achieve a
realistic breakeven gas price, and to capitalize on current
downward pressure on drilling and other construction costs, Azonto
and its partners have therefore decided to re-tender the
construction package. This will result in a delay in sanctioning
the Gazelle project.
Azonto and its partner Vitol have also continued to mature the
Hippo North prospect which is located 7km from Gazelle in shallow
water of 70m. Hippo North is now ranking high in the CI-202
exploration portfolio to deliver potential additional gas resources
to complement the Gazelle Field. In addition Azonto and its CI-202
partner Vitol recognise that there would be synergies in combining
a Hippo exploration well with the Gazelle drilling campaign which
would significantly reduce the cost of the exploration well. If
successfully drilled and tested, Hippo North could extend the
production profile on Gazelle by feeding through the existing
facilities being planned for the project. A final decision on the
drilling of Hippo North will need to be made by 7th October 2015,
subject to budgetary approval.
The team has continued to invest time and effort to identify
prospects in, and adjacent to, the Block which could form part of a
regional gas play with substantial liquid upside, again revolving
around core facilities about to be constructed in Grand Bassam.
Our goals are clear: lower G&A, renewed focus on our key
asset, and accelerated efforts to secure a strategic solution that
ensures more solid financial backing for the long-term development
of the block and/or a sale of the asset. There is no guarantee any
discussions will lead to a sale of its assets and/or a sale or a
merger of the company
We are continuing to take and implement difficult but necessary
measures to maximize our ability to find a strategic solution over
the next few months and to leverage the existing possibilities on
our Licence Area.
Grégory Stoupnitzky
Managing Director
Operations Summary
CI-202 - Côte d'Ivoire
Azonto holds a 35% ownership interest in Vioco Petroleum Ltd,
which holds an 87% operating working interest in offshore Block
CI-202. Vioco's working interest will be reduced to 71% if Petroci
exercises its 16% back-in right, which will be decided Q2 2015.
Vitol E&P Ltd holds the remaining 65% of Vioco.
Gazelle Field Development
The Engineering, Procurement and Construction bid for the
Gazelle project has been received. In light of the current oil
price environment, it has been decided to retender the project and
benefit from the downward cost trend. A Steering committee has been
established with Vioco, the gas buyer, CI-Energies, and the IPP
contractor. Vioco is currently engaged with the IPP contractor to
establish firm scope and schedule for an integrated project.
2015 exploration activity
Further work has been carried out to evaluate the Hippo North
prospect, located 7km from Gazelle in shallow water of 70m,
including the identification of an additional slightly deeper
objective. The remaining prospectivity is currently being high
graded, which has resulted in some exciting leads with significant
upside potential.
CI-202
Offshore Côte d'Ivoire - Ivorian Basin
30km South East of CDI Capital - Abidjan
35% ownership interest in Vioco Petroleum Ltd, which holds an
87% operated working interest in offshore Block CI-202. Vioco's
working interest can be reduced to 71% if Petroci exercises its 16%
back-in right after development approval is granted.
Offshore Accra Contract Area - Ghana
In Ghana we have reluctantly decided to relinquish the Accra
Block. Following the exit of the other partners in March 2014
Azonto's Ghanaian subsidiary, in which Vitol E&P Limited has a
43% interest, and the other remaining partner Afex Oil secured a
six-month extension of the initial exploration period to September
2014 and conducted a farm-out process to try to find a suitable
operating partner.
Despite significant industry interest, as a result of
challenging market conditions a farm-out could not be concluded,
and the partners elected not to seek a further extension to the
initial exploration period, nor to apply to enter into the first
extension period. We are currently finalising the closure of our
Ghana operation.
Financial
Equity Issues
There were no equity issues in the quarter.
Capital Structure at 31 March 2015
Number
----------------- -------------
Shares 1,159,375,100
----------------- -------------
Unlisted options 35,310,150
----------------- -------------
Cash
Cash on hand at 31 March 2015 was A$5.1 million (unaudited).
Significant Shareholders
at 31 March 2015
Number %
----------------------- ---------- -----
6466 Investment PTY
Ltd 76,198,981 6.57%
----------------------- ---------- -----
Genesis Asset Managers
LLP 70,138,995 6.05%
----------------------- ---------- -----
Mr Stephen John Dobson 64,247,719 5.54%
----------------------- ---------- -----
International Finance
Corporation (IFC) 63,707,267 5.49%
----------------------- ---------- -----
This information is provided by RNS
The company news service from the London Stock Exchange
END
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