Continental Focus, International Reach

Eland Updates Opuama

Tuesday, April 25, 2017

Eland Oil & Gas is seeing its Opuama-3 well in Nigeria’s OML 40 producing at a rate of approximately 8,000 bpd, with exports ongoing. Since Eland’s last announcement, an estimated 120,000 barrels of oil have been delivered to the export terminal, with a further 40,000 to be injected imminently.

Monetization of this crude is expected to be in the region of $8.5 million in the coming weeks.

The company expects to commence the side-track of Opuama-7 well by the end of H1 2017.  A further approximate $7 million of capex is required for the completion of this side-track, which is expected to add around 6,000 gross bpd of production from OML 40. Following the successful side-track of Opuama-7, the company will look to include this significant increase in production in its borrowing base and expects the headroom to increase accordingly to allow for further development funding for OML 40.

The previously announced borrowing base review of the company’s Reserves Based Lending facility is complete and has resulted in a borrowing base amount confirmed at $24 million. The redetermination was based on the production performance of Opuama-1 and Opuama-3, shipping export route and outlook. Eland has a current cash balance of $7.5million of which, pursuant to the borrowing base redetermination, $0.8million is restricted to cover debt service.

George Maxwell, CEO of Eland, commented: “The successful borrowing base review with our bank, Standard Chartered, ensures we are funded for our upcoming work programme at Opuama-7 which we expect to commence in the near term. Weare targeting bringing Opuama field’s gross production from Opuama-1, 3 and 7 up to 17,500 barrels of oil a day by early H2 2017.

“There is real momentum in the business as we focus on growing our production sharply and I look forward to updating all stakeholders on our drilling activities at Opuama-7 in the future.”

 


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