Afentra plc ('Afentra' or the 'Company'), the upstream oil and gas company focused on acquiring mature production and development assets in Africa, announces its half year results for the six months ended 30 June 2022 (the 'Period').
· Cash resources as at 30 June 2022 of $27.1 million (30 June 2021 of $40.8 million)
· Additional restricted funds of $8.0 million1
· Adjusted EBITDAX loss of $1.2 million (1H 2021: loss $1.5 million)
· Loss after tax of $2.9 million (1H 2021: loss $2.4 million)
· The Group remains debt free and fully carried for Odewayne operations
The Company announced two strategically consistent and complementary transactions in Angola, signing sale and purchase agreements ('SPAs') with completion expected in Q4 2022 (together the 'Acquisitions'):
· Sonangol Acquisition: acquisition of interests in Block 3/05 (20%) and Block 23 (40%) offshore Angola for a firm consideration of $80.5 million and contingent payments of up to $50 million;
· INA Acquisition: acquisition of interests in Block 3/05 (4%) and Block 3/05A (5.33%)2 offshore Angola for a firm consideration of $12 million and contingent payments of up to $21 million;3
· Financing Agreements: Sonangol and INA Acquisitions will be financed through cash on the balance sheet and agreed RBL and revolving working capital facilities with Trafigura:
o 5-year RBL facility with up to $75 million available to finance the Acquisitions (8% margin over 3-month secured overnight financing rate (the 'SOFR')) (the 'Acquisition Facility');
o Revolving working capital facility for up to $30 million to finance asset funding requirements between crude offtakes (4.75% over 1-month SOFR) (the 'Working Capital Facility').
· Offtake Agreement: The Company has also entered into an offtake agreement with Trafigura for Afentra's crude oil entitlement lifted from the Acquisitions.4
AIM Re-admission Process
· AIM Admission Document was published on 10 August 2022. Suspension of the trading in the Company's shares was lifted and trading in the Company's ordinary shares recommenced
· General Meeting: Resolution to approve the Sonangol Acquisition was passed at the General Meeting held on 30 August 2022
· Completion of the Acquisitions and re-admission of the enlarged group to trading on AIM is anticipated in Q4 2022
Operations pursuant to the ongoing Acquisitions
· Block 3/05: Congo basin, Angola (24% interest)5 - net 2P reserves of 27.7 mmbo, net 1H 2022 production of c. 4,700 bbl/day, net 2C resources of 10 mmbo with significant potential for future upgrades
· Block 3/05A: Congo basin, Angola (5.33% interest)2,5 - three appraised discoveries in adjacent licence to Block 3/05, providing tie-back opportunities using existing infrastructure; net 2C resource of 1.8 mmbo
· Block 23: Kwanza basin, Angola (40% interest)5 - highly prospective deepwater exploration and appraisal opportunity that is largely under-explored containing a small pre-salt oil discovery
· Odewayne exploration block: offshore Somaliland (34% interest fully carried by operator, Genel Energy) - the team continues its technical assessment and outlook on block prospectivity in discussion with the operator
Paul McDade, Chief Executive Officer, Afentra plc commented: "The first half of 2022 marked a transformational period for the Company, including the foundational asset transaction with Sonangol enabling entry into Block 3/05 in Angola. Following Period end, Afentra announced an incremental transaction with INA gaining additional exposure to the high quality 3/05 block and the adjacent 3/05A block. Combined, these complementary acquisitions provide a strong growth platform, underpinned by robust cash flow and significant potential to deliver upside value. The financing and offtake agreements announced with Trafigura demonstrate our ability to efficiently fund our focussed buy and build strategy. In August, we were pleased to recommence trading in Afentra's shares on AIM and, subsequently, shareholder approval of the Sonangol transaction. We take confidence that the completion of a smooth election process and the re-instatement of the government will allow the Company to re-engage with the Government to achieve completion of the transactions in Q4 2022. Meanwhile, the Company continues to remain highly active and disciplined in its assessment of the opportunity landscape in line with its stated growth strategy."