TIDMVOG
RNS Number : 1507X
Victoria Oil & Gas PLC
30 April 2021
30 April 2021
Victoria Oil & Gas Plc
("VOG" or the "Company")
Q1 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 an operations
update for the first quarter of 2021.
SUMMARY
-- Sales . Average daily gross gas sales rate for the quarter of
5.2 MMscf/d (Q4 20: 5.1 MMscf/d) of natural gas plus gross 5,473
bbls (Q4 20: 3,109 bbls) condensate was produced safely and sold to
industrial customers in the Douala area.
-- La-108 Performance . The well continues to supply the base
demand, topped up by well La-105. The water production from the
well continues to fall, albeit slowly.
-- Matanda . Well planning continues and the next batch of the
public hearings have taken place in villages near potential
wellsites.
Roy Kelly, Chief Executive of the Company, commented :
"We are very pleased with the recent progress made on a number
of fronts, both from an operational and corporate perspective, with
some of these having been reported on separately in the last few
weeks. We are happy to report that the sales gas demand has
remained very robust, and the next customer to increase organic
demand has already started commissioning his new equipment.
Operationally, the falling water production from well La-108 is
welcome, and we continue to use the well for our base load whilst
we monitor the well closely.
The public hearings for the Matanda drilling programme are being
well attended and good engagement is taking place with local
communities."
LOGBABA UPDATE
Quarterly Production
GDC continues to safely produce and sell natural gas to a
variety of customers in the Douala area, most of whom would have
previously burned liquid fuels. Quarterly gross and net gas and
condensate sales at Logbaba are as follows (amounts in bold are net
gas and condensate sales attributable to GDC (57%)):
Q1 2021 Q4 2020
Gas sales (MMscf)
------ ------ ------ ------
Thermal 252 442 250 438
------ ------ ------ ------
Industrial power 13 23 15 27
------ ------ ------ ------
Total (MMscf) 265 465 265 465
------ ------ ------ ------
Daily average gross
gas sales rate (MMscf/d) 5.2 5.1
-------------- --------------
Condensate shipped
(bbls) 3,120 5,473 1,772 3,109
------ ------ ------ ------
Gas Demand
Recent mid-week demand has been 5.5 - 6.0, with peaks over 6.0
MMscf/d, but the quarterly average is dragged down by the typical
slow build-up in early January after the holiday season. Towards
the middle of the year, we look forward to two other existing
customers increasing demand by up to 1.0 MMscf/d.
La-108 Performance
GDC continues to use well La-108 at a constant rate to the
extent possible so that we can observe its performance. The well's
water-gas-ratio which was over 55 bbls/MMscf in the middle of March
has continued to fall and has been less than 40 bbls/MMscf in the
last few days. The level of water production has fallen to less
than 160 bbls/d and this is easily manageable. The well has
produced 0.3 Bcf to date, and will be shut in for a pressure
build-up at some stage.
MATANDA UPDATE
Work continues on well design, site and rig selection. Under the
guidance of the Ministry for Environment, the Company held public
hearings in villages in the vicinity of potential surface well
locations which were very well attended. During these meetings, the
Environmental and Social Impact Assessment was available to be read
and any further queries raised.
Management has been conducting sub-surface analysis of the
various prospects, onshore Matanda and a ranking exercise has
lifted, two prospects, Marula (P(mean) Unrisked Prospective
Resource of 69 Bcf) and Theobroma (P(mean) Unrisked Prospective
Resource of 25 Bcf), to the top of the list, though the Company is
carefully considering all the surface issues including impact on
nearby residents (if any), footprint of the site, access from major
roads, and so on. The quoted prospective resources for these
prospects are Company estimates, which form part of the previously
disclosed estimate for Matanda Onshore of 1,196 bcf.
LITIGATION UPDATE
As has been previously disclosed, RSM instituted an arbitration
in Texas, USA under ICC rules in which it is asserting material
claims primarily related to invoices for the drilling of wells
La-107 and La-108, and certain audit exceptions. The substantive
matter has just been heard by an Arbitration Panel under ICC rules
in the U.S.A., though it will take several months before the Panel
publishes its findings.
Arbitrations under ICC rules are confidential processes, and VOG
is thus not permitted to provide detailed comments on them, beyond
saying that it continues to vigorously defend the claims raised by
RSM. The amounts under dispute in this arbitration, including GDC's
counterclaims, are significant and an adverse finding could have a
material impact upon the results and position of the Group.
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 (corporate advisory) Tel: +44 (0) 207 408 4090
Jerry Keen (corporate broking)
Camarco (Financial PR)
Billy Clegg/Nick Hennis Tel: +44 (0) 20 3772 2499
Notes
Sam Metcalfe, the Company's Subsurface Manager has reviewed and
approved the technical information contained in this announcement
in his capacity as a qualified person under the AIM Rules. Sam has
over 30 years of industry experience, and has an MSc in Petroleum
Engineering from The University of Texas at Austin.
The P(mean) resources given above are estimates of the average
prospective resources (unrisked for chance of success), based on an
assessment of volumetric uncertainty of the prospects.
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