Afentra plc (AIM:AET, OTC:STGAF) told investors it has entered a contract for Block KON4 in the onshore Kwanza basin of Angola.
The contract (a ‘Risk Service Contract’) gives the AIM-quoted firm a 35% operating interest in the project, which spans 1,387 square kilometres and covers eleven past producing oil and two gas fields that historically yielded 90 million barrels of oil production.
It includes the Quenguela Norte field, which was Angola’s largest onshore discovery, and is host to over 200 million barrels and previously saw peak production of 12,000 bopd.
Afentra said there is immediate upside in reactivating legacy fields using modern techniques, alongside low-cost near-field exploration.
In Monday’s statement chief executive Paul McDade described the contract as “a significant step.
“While this marks the beginning of the formal approval process, we are already working closely with our partners in the contractor group to prepare for an efficient review of the block's existing oil fields and the potential for early development opportunities,” McDade said.
He added: “The addition of the KON4 license to our existing onshore licenses will represent a compelling opportunity to work with local Angolan companies to both revitalise historic oil fields with modern production and development techniques as well as understand the full exploration potential of this underexploited basin where exploration activities stopped over 40 years ago."
Afentra shares were up around 3% on Monday, changing hands at 52.89p, valuing the Africa-focused oil firm at around £120 million.