Africa Oil Corp (TSX:AOI) announced that its investee company Impact Oil & Gas has finalized a farm-down of its interests in offshore Namibia's Blocks 2912 and 2913B to TotalEnergies EP Namibia.
The transaction included a cash reimbursement of approximately $99 million to Impact for costs previously incurred on the blocks.
Impact retains a 9.5% interest in each block and will be carried by TotalEnergies for future development and exploration costs until oil production begins.
Africa Oil holds a 32.4% stake in the company.
This carry loan, repayable through Impact’s share of cash flows from production, bolsters Impact’s position without immediate financial burden.
The Farm Down allows Africa Oil to keep a funded interest in the Venus development project that, according to the company’s CEO Roger Tucker, is expected to add “significant reserves and production” to its portfolio.
“We also believe there is tremendous exploration upside on the Blocks starting with the recently spud Tamboti-1X well,” Tucker said in a statement.
The transaction completes a requirement for Africa Oil’s planned consolidation with Prime Oil & Gas, anticipated for Q1 2025. Africa Oil’s interest in Impact could rise to 39.5% upon closing a separate share agreement, increasing its effective stake in these Namibian assets.
Since discovering the Venus field in 2022, five wells have been drilled on Block 2913B, four of which encountered oil. A first development plan is expected by the end of 2025, with recent 3D seismic data covering much of the blocks.
Block 2913B holds the Venus light oil field, with Impact holding 9.5% alongside TotalEnergies (50.5%), QatarEnergy (30%), and NAMCOR (10%). Neighboring Block 2912 sees Impact holding 9.5%, while TotalEnergies leads with a 47.2% interest.