Friday, December 1, 2023
ADM Energy announced that its Board of Directors has completed an internal review of existing investments, financial resources and future investment opportunities available to the Company. The key takeaways of this review include:
OML-113 Description and Recent Developments
The Company holds a 12.3% cost share and 9.2% profit share interest in OML-113 covering an area of 835km² offshore Nigeria, which includes the Aje Field. Aje, which has produced more than 5 million barrels of oil to date, is rich in gas and condensate reserves with multiple oil, gas, and gas condensate reservoirs in the Turonian, Cenomanian and Albian sandstones with five wells drilled to date. Based on ADM’s 2019 Competent Persons Report, Aje represents 8.9 million barrels of oil equivalent resources with a mid-case PV-10% of US$25.9 million to ADM’s interest based on a US$70 oil price scenario.
The decision by the Board to consider alternatives for monetizing the Company’s interest in Aje follows the acquisition by PetroNor E&P ASA (PetroNor) of an additional 32.1% cost sharing and 24.1% profit share interest in OML-113 announced 3 October 2023. Under PetroNor’s leadership, the Company and its consortium partners have been in dialog regarding plans to proceed to a final investment decision regarding the further development of Aje in 2024.
Additionally, the consortium has commenced reprocessing of 3-D seismic covering the Aje Field and a significant portion of the OML 113 license area offshore Nigeria. The reprocessing is near completion and fully reprocessed 3-D seismic is expected to be available for interpretation in early 2024.
The Board view these positive developments with respect to commercializing Aje as presenting a favorable time to initiate the process of partnering, financing or monetizing its interest through sale of the asset with the objective of maximizing value and freeing up capital to deploy into other projects in keeping with the focus of the Company on opportunities in energy related technologies.
Stefan Olivier, CEO of ADM Energy plc, said: “The investment in Efficient Oilfield Solutions, LLC announced 29 November 2023 is a pivotal strategic development representing a new focus for the Company away from capital intensive, long lead-time projects toward compelling opportunities with a clear path to cash flow in high growth energy technology and energy transition related opportunities.”
“With recent interest by the German government in working with Nigeria to realize the potential of its massive natural gas reserves, Aje represents a de-risked asset that we believe will be attractive to a variety of strategic and financial investors. Along with the entire Board of ADM, I am committed to realizing the potential of the Aje Field and the entire license area for ADM and its shareholders while re-deploying capital into the attractive energy technology opportunities available to the Company.”