Oando Energy Resources Inc. (OER), a company focused on oil and gas exploration and production in Nigeria, said production from its existing assets for the first half (H1) of the year was 821,786 barrels (an average of 4,540 barrels per day (bpd)) compared with 687,757 barrels (an average of 3,800bpd) for the comparative period.

The increase in production was primarily as a result of improved well optimisation at Oil Mining Lease (OML) 125 (Abo field), the company said, in its financial and operating results for the six month period ended June 30, 2014, released last week. Production also increased at the Ebendo field (OML 56).

OML 125 production increased by 17 percent to 651,000 barrels in the six months ended June 30, 2014, from 557,000 barrels in the comparative period. The Ebendo field production increased by 30 percent to 171,000 barrels from 131,000 barrels in the comparative period.

The company said it spent $9.2 million on Umugini pipeline construction and Ebendo Well 7 drilling and completion activities and flow station de-bottlenecking in the period, adding that projected delivery date remain to be completed during the fourth quarter (Q4) of 2014.

The 45,000bpd Umugini pipeline is designed as an alternative evacuation route for the OML 56 asset.
Ebendo Well 7 was successfully drilled and completed on April 1, 2014, the company said, adding that the well had since been shut in pending completion of Umugini pipeline.

Pade Durotoye, CEO, OER, said: “This half year we have witnessed a 20 percent growth in production against last year, due to optimisation processes on our current producing assets.

“We are truly excited at the 9 fold ramp up in production that we are experiencing in H2, 2014, as well as a much larger corporation, as a result of our completion of the acquisition of the ConocoPhillips Nigeria business unit, our immediate outlook will be to integrate the systems, processes and people towards growing the business and creating true value for our shareholders.”

OER said revenue declined from the comparative period by $3.2 million in the first half of 2014.

“During this period, lower realised net sales prices reduced revenues by $13.4 million and increased production increased revenues by $10.2 million. Lower revenues from lower realised net sales prices were primarily due to $13 million in unrecognised revenue at OML 125,” said OER.

On July 30, 2014, Oando completed the acquisition of ConocoPhillips Nigerian business unit, with an effective date of January 1, 2012. The final purchase consideration for the acquisition transferred on July 30, 2014, net of working capital adjustments, transaction costs, purchase price adjustments was $1.5 billion. The total reserves and resources associated with this transaction are proved plus probable reserves of 211.6 million barrels oil equivalent (MMboe); best estimate contingent resources of 498.6 Mmboe, and unrisked best prospective resources of 656.9 MMboe

Source: Businessday
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