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Eland Oil & Gas to be taken over by local peer Seplat

Snapshot

  • Owns substantial production assets in Nigeria
  • Production profile rising strongly  
  • Seplat has made an agreed bid that values Eland at £382mln/166p
oil rig

Quick facts: Eland Oil & Gas PLC

Price: 165.4 GBX

AIM:ELA
Market: AIM
Market Cap: £356.7 m
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We are pleased to have successfully completed the remedial work on Gbetiokun-3 and are very happy with the achieved flow-rates of almost 7,000 bopd.

 

George Maxwell, chief executive

How it is doing

Eland Oil & Gas PLC's (LON:ELA) production for 2019 is now expected to be 10,500 barrels per day net after technical issues at the Gbetiokun-4 well.

Eland owns 45% of Elcrest, with 55% held by Starcrest Energy Nigeria

Elcrest has a 45% stake in OML 40, located in the north-west Niger Delta.

Gbetiokun-4 is one of two development wells designed to add a further 15,000 barrels per day gross.

Gbetiokun-1 performance already established at over 5,000 bopd.

Gbetiokun-3 achieved flow rates of 7,000 bopd in recent flow test.

Eland also has a 40% interest in the Ubima field, located onshore Niger Delta just north of Port Harcourt.

Ubima has tested at 3,500 bopd gross or 1,400 net to Eland.

What the boss says: George Maxwell, chief executive

"The challenges on Gbetiokun-4 highlight the complexities that can occur in the drilling and completion sequence.

“We are confident that when the required equipment arrives in-country, we will move forward with the completion of Gbetiokun-4 and bring further production online as planned.”

Inflexion points

  • The takeover by Seplat completes
  • Gbetiokun-5 is drilled successfully and remedial work brings Gbetiokun-4 on line
  • Extended well test gets underway at Ubima

Blue sky

The OML 40 licence holds gross 2P reserves of 82.2 mmbbls (million barrels) and gross 2C contingent resources of 50.7 mmbbls.

Ubima holds gross 2P reserves of 9.3 mmbbls of oil and gross 2C resource estimates of 4.2 mmbbl.

Both prospects offer substantial upside from further exploration and development.

 

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