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Lekoil Ltd: THE INVESTMENT CASE

LEKOIL encouraging investors as Otakikpo production ramp-up continues

Phase 1 of the Otakikpo field is targeting 10,000 bopd of production, with Phase 2 due to raise the bar to 20,000 bopd.
oil and gas operations
INVESTMENT OVERVIEW: LEK The Big Picture
LEKOIL restarted Otakikpo back in February.

Investors in Nigeria focussed LEKOIL Limited (LON:LEK) will no doubt have been encouraged by the apparent strength of the ramp-up at the Otakikpo field.

Otakikpo’s Phase 1 production target is set at 10,000 barrels of oil per day, and it has now begun preparations for Phase 2 which will aim to double output to 20,000 bopd.

Much has been achieved in the months since LEKOIL restarted Otakikpo back in February.

In December, the company reported that production rate amounted to 7,600 bopd and by early January output was described as approaching the 10,000 bopd target.

A new programme kicks off Phase 2 at Otakikpo

LEKOIL’s joint venture vehicle Green Energy International has hired a Sinopec unit for the programme, which will capture just under 200 square kilometres of 3D data, spanning both the onshore and offshore areas.

It is expected that the seismic work will get underway in the first quarter of the year and it will effectively kick off the second phase of development for the Otakikpo field.

The new data will guide a fresh campaign of drilling.

"With significant milestones already achieved in 2017 as the Otakikpo technical and financial partner, today's announcement demonstrates LEKOIL's progress into the next phase of delivery and growth,” said Lekan Akinyanmi, Lekoil chief executive.

“The company expects the Phase Two development to be fully funded by industry players, which the company is already in discussions with."

Ogo discovery and other exploration projects

Aside from Otakikpo, the company also holds a 40% working interest, with a 70% economic interest, in the world class Ogo oil discovery.

Ogo, located in the Dahomey basin, and it is estimated to host more than 774mln barrels of oil equivalent prospective resources.

In shallow water, the project is located in the vicinity of Lagos and existing gas infrastructure.

In September, the company told investors that discussions continued with potential partners for the financing of the OPL310 appraisal.

The company also holds a 63% interest in the OLP 325 portfolio, which is described as a ‘promising’ deep water turbidite fan play.

OPL 325 is also located in the Dahomey basin, and it is described as being ‘on trend’ with Ogo. The exploration area spans some 1,200 square kilometres and it is estimated to have some 5.7bn barrels of prospective resources.

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Lekoil Ltd Timeline

Newswire
September 28 2017

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