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Victoria Oil & Gas surges after pencilling supply deal with Aksa Energy

"We are delighted to have begun a partnership with such a high-profile, professional and reputable company such as Aksa Energy which has a depth of experience in installing and operating successful gas facilities across Africa," said VOG's CEO, Ahmet Dik

Gas installation
The government of Cameroon has given its support to this project

Victoria Oil & Gas PLC (LON:VOG) has signed a non-binding term sheet for an energy supply deal in Cameroon.

The agreement is with Aksa Energy to supply up to 25mln standard cubic feet a day of gas to Aksa Energy's planned 150-megawatt power station in Bekoko, Douala.

READ Victoria Oil & Gas receives US$800,000 payment from ENEO, updates on second quarter production

The key commercial terms between Aksa Energy and Victoria’s wholly-owned subsidiary, Gaz du Cameroun, include:

  • A gas price of US$6.75 per million British thermal units;

  • A term of 25 years, plus an option to extend for an additional five years; and

  • A 70% take or pay component.

"Considerable progress has been made in our gas-to-power strategy, as evidenced by the term sheet signed with Aksa Energy, one of the largest global independent power producers,” said Ahmet Dik, the chief executive officer of Victoria Oil & Gas (VOG).

“Upon commencement, which is planned for late 2020, production levels would dwarf the current level of gas sales and propel VOG into a profitable trajectory of growth which has always been our aim. Much work and effort by all stakeholders has gone into progressing this project and I am confident the additional power expected to be generated will be highly beneficial for the Cameroonian people and the economy as Douala continues to attract industry into the busy port town,” he added.

Shares in Victoria Oil & Gas were up 12% at 15.5p in early deals.

Quick facts: Victoria Oil & Gas PLC

Price: 6.92 GBX

AIM:VOG
Market: AIM
Market Cap: £17.77 m
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