PetroNor boosts its stake in gas field off Nigeria

Oslo-listed oil and gas company PetroNor has set the wheels in motion to increase its interest in the offshore mining lease no. 113 (OML 113), containing a gas field, offshore Nigeria by acquiring New Age (African Global Energy) Limited’s stake in this license.

PetroNor has entered into a binding agreement to get its hand on New Age’s interests in OML 113 in Nigeria which contains the Aje field. According to the Oslo-listed player, this acquisition strengthens its position in OML 113 and opens up possibilities for future growth in the energy transition and strategic flexibility. Based on the agreement, PetroNor will pay New Age $6 million cash plus a deferred future gas production payment up to a maximum of $20 million to acquire the entities holding a project economic and voting interest in the OML 113 joint operation agreement (JOA) of 32%.

Jens Pace, Interim CEO of PetroNor, commented: “This acquisition is consistent with PetroNor’s commitment to expanding its portfolio while demonstrating shareholder value. Acquiring New Age’s interests represents a big step in achieving the partner alignment necessary to move forward with plans for the redevelopment of the Aje field. We are excited about the potential value of this gas resource which is located close to major population centers and offers a cleaner source of energy for power generation and industrial use compared to current alternatives.”

Subject to completion, the agreement will not only increase PetroNor’s economic stake but also reinforce the company’s active involvement and influence in the license partnership to plan for the redevelopment of the Aje field. The firm’s existing position in OML 113 was achieved through the acquisition of Panoro Energy’s stake in a transaction which completed in 2022. In addition, PetroNor is working with the OML 113 operator, Yinka Folawiyo Petroleum (YFP), to create a jointly owned company, Aje Production, which will hold a project economic and JOA voting interest of 39%.

Following the completion of these transactions, PetroNor and YFP-related entities will have a project economic and JOA voting interest of 71%. The Aje field is estimated to contain recoverable resources of 480 bcf of gas, 54 mmbbls of oil, condensate, and LPG. The acquisition of New Age’s Aje interests will increase PetroNor’s net 2C contingent resources in Aje from 27.1 mmboe to 70.1 mmboe. The completion of the transaction is subject to customary conditions, including regulatory approvals in Nigeria.

Stefan Olivier, CEO of ADM Energy, remarked: “With the acquisition by PetroNor of Panoro’s interest in 2022, PetroNor’s partnership with YFP Deepwater and now consolidation of the New Age interest – PetroNor is now in position to provide the strong and capable leadership that Aje requires. We look forward to working with PetroNor toward re-initiation of development activity and realizing the intrinsic value of ADM’s holding in OML 113.”

ADM Energy holds a 9.2% profit interest in the Aje field in OML 113, which covers an area of 835 km² offshore Nigeria. The field has multiple oil, gas, and gas condensate reservoirs in the Turonian, Cenomanian, and Albian sandstones, with five wells drilled so far. The Aje field was discovered in 1996 and, following several appraisal wells, it started production in May 2016 via the FPSO Front Puffin.