Bowleven, the Africa focused oil and gas exploration Group traded on AIM, announces its unaudited interim results for the six months ended 31 December 2019.
- Continued progress on Etinde development options and working with joint venture (“JV”) partners towards agreeing Final Investment Decision (“FID”) in late 2020.
- Lead contractor appointed to manage the Front End Engineering Design (“FEED”) process.
- TechnipFMC are expected to commence project activity in early April, with a planned duration of five to eight months.
- Letter of Intent (“LOI”) signed between Victoria Oil & Gas Plc and New Age (African Global Energy) Ltd ("New Age"), for the supply of gas from the Etinde Field, offshore Cameroon.
- Ongoing market volatility, caused by the COVID-19 global pandemic and the recent fall in global oil prices could potentially have an adverse effect on the Etinde project timeline.
- The JV partners are proceeding with:
o FEED related processes
o Continuing commercial activities focused around a liquids-based development alongside discussion of sales terms with potential gas, condensate and Liquefied Petroleum Gas (“LPG”) off-takers
o Preparatory steps for raising development finance, potentially on a jointly funded basis, to implement the Etinde development project
- Reprocessing seismic data relating to the IE/ID/IB/IC areas of Etinde
- Discussions with the Government of Cameroon and Société Nationale des Hydrocarbures (“SNH”) to finalise the closing position and return the licence to the State are ongoing
- Group cash balance at 31 December 2019 was circa $10.9 million with a further $2.3 million held in financial investments with no debt and material financial commitments
- A bank guarantee relating to the deposit of $0.5 million is due to end shortly and we expect this amount will be added to our free cash resources shortly
- Bowleven considers the value of cash and investment of $13.7 million to be sufficient to meet the Group’s financial requirements until FID on Etinde is reached
- The loss for the six month period was $1.4 million compared to $1.4 million in the equivalent period last year.
Eli Chahin, Chief Executive Officer of Bowleven plc, said:
“During the period, we were pleased with the progress made towards achieving FID at Etinde. We advanced a number of important project related work streams, including; appointing a lead FEED contractor, assessing commercial arrangements for the produced condensate and gas, and reviewing potential financing options for the project.
At a time of considerable market turbulence, we are fortunate to benefit from a robust financial position, with in excess of $10 million of cash on the balance sheet and no debt. Coupled with our low cost base, we are well funded to reach FID, after which we will receive $25 million from the JV partners.
Despite the solid progress Bowleven has been making, recent macro conditions have the potential to impact the timing of the Etinde project. As a business, we will continue to work towards achieving FID before year-end and we look forward to keeping all of our stakeholders appraised on progress over the coming months.”