Material uplift on the cards for Nigerian offshore gas field

The initial internal review of reinterpreted 3D seismic data for a field off the coast of Nigeria, initiated by the OML-113 license joint venture (JV) partners, suggests a material uplift in the field’s potential and value.

Following the reprocessing of 3D seismic, covering the Aje field and a significant portion of the OML-113 license area offshore Nigeria, ADM Energy, one of JV partners, believes that the potential and the value of Aje, as well as financing options available for its stake in the field, are expected to increase. The company is in talks with several financial and strategic investment groups that have already expressed interest in acquiring the firm’s stake in the field.

The reprocessing of 3D seismic, valued at approximately $600,000, was initiated in the fall of 2023 by JV partners Yinka Folawiyo Petroleum (YFP), Energy Equity Resources (EER), PetroNor E&P, and ADM Energy. YFP is the operator and holds a 22.5% cost share, while the remaining partners hold a 16.8%, 16.3%, and 12.3% cost share, respectively. In October 2023, PetroNor inked a binding agreement to purchase the remaining 32.1% cost share from New Age and increase its interest in the field.

Stefan Olivier, CEO of ADM Energy PLC remarked: “The board is very encouraged by the Aje partnership’s assessment of the newly reprocessed 3D seismic dataset across the Aje field. We look forward to having the data reviewed by an independent technical consultant and are confident that the results, once available, will result in a material uplift to the assessment of the Aje field and the intrinsic value of the asset.”

With 3D seismic reprocessing completed, the partners and geophysical experts are now engaged in a field wide structural reinterpretation of data, which ADM Energy intends to have reviewed by an independent technical consultant and provide an update to the field volumetrics and recoverable reserves and resources via a revised competent persons report (CPR). Based on the company’s 2019 CPR, the field represented 8.9 million barrels of oil equivalent resources with a mid-case NPV 10% of $25.9 million to ADM’s interest based on a $70 oil price scenario.

First discovered in 1997, the Aje field is located within the 835-kilometer-square OML-113 license area offshore Nigeria. Five wells have been drilled so far, however, more drilling is planned to develop the resources further. While production from Phase 1 began in May 2016 via the FPSO Front Puffin and the planning for Phase 2 is underway, Phase 3 is expected to target the development of the Turonian gas condensate reservoir.

This field, which is perceived to be rich in gas and condensate reserves, has multiple oil, gas, and gas condensate reservoirs in the Turonian, Cenomanian, and Albian sandstones.