Africa Oil Corp (TSX:AOI) described its first quarter as “a significant period” in which it secured two strategic farm-down transactions in the highly sought-after Orange Basin.
The deals are expected to de-risk the company’s balance sheet as it advances its key projects.
“Through these transactions we will retain significant upside, including exposure to the world-class Venus development project, offshore Namibia, at no upfront cost,” chief executive Roger Tucker said in a statement.
“With the funding assured for our core Orange Basin assets, we were able to continue with our shareholder capital return program including the re-start of share repurchases, and distributing the first semi-annual dividend for 2024."
Tucker added: “Africa Oil is in a strong position to work its core asset opportunity set, and we can now look forward to progress on the Venus project, our first Orange Basin discovery, towards a final investment decision and first production.
“This asset is expected to add significant reserves and production to our portfolio from the late 2020s through the 2030s and beyond."
Boosted by the farm-out transactions, Africa Oil has increased shareholder capital returns, distributing $25.4 million in the first quarter of 2024 and $37.5 million from the start of the year to May 10, 2024.
The company retains a strong financial position with a cash balance of $195.5 million and no debt.
Meanwhile, from its interest in production via its 50% shareholding in Prime.
Some $25 million was paid in dividends to Africa Oil by Prime, which produced around 17,100 barrels oil equivalent per day and generated $77.1 million of cash flow from operations.
Africa Oil reported $3.5 million of net income attributable to common shareholders for the quarter.