Sirius Petroleum, the Nigeria-focused oil and gas development and production company has announced that it is in advanced stages of discussions on funding which will enable it to conclude a funding facility to be deployed towards the execution of a minimum work programme commitment on the Ejulebe field (the “Transaction”).
The Transaction was conditional upon, among other things, Sirius having arranged for debt funding to be provided to fund certain capital expenditure on the Ejulebe field. The proposed debt provider views the Transaction positively and has agreed that the Transaction should now proceed on the basis that Sirius be both the borrower and guarantor of the proposed facility.
The effect of these arrangements is that the transaction would now constitute a reverse take- over under Rule 14 of the AIM Rules for Companies and would be subject to Shareholders’ approval. In accordance with the AIM Rules, the Company’s shares have been suspended from trading on AIM with immediate effect and will remain suspended until an AIM admission document has been published or until the Company confirms that the Transaction is not proceeding. A further announcement will be made as and when appropriate.
As announced on 4 December 2018, the Transaction is potentially transformational for Sirius. OML 109 is located approximately 30km due south of OML 95, where the Ororo field is located. Encompassing 191,000 acres or 773 square kilometres, the OML 109 block has only been addressed with three exploration wells in its entire history, the first in 1966. Extensive oil and gas infrastructure exists in and around the block, including that of the Ejulebe field.
The Ejulebe field comprises some 15 hydrocarbon-bearing horizons, producing oil, associated and non-associated gas (including condensate). The field has produced approximately 14 mmbbls since 1998, is currently producing c.250 bbl/d and has gross remaining 2P reserves of 4.7 mmbbls, according to a competent person’s report prepared by PanTerra Geoconsultants in December 2017 (the “CPR”).
The EJ-WSW and EJ-SW exploration prospects, which according to the CPR contain respectively gross unrisked P50 prospective resources of 32-38 mmboe and 32-53 mmboe are close to the Ejulebe field and are expected to have similar reservoir characteristics to the Ejulebe field. All resource terms as defined by the Society of Petroleum Engineers – Petroleum Resources Management System.
The wider OML 109 “Joint Exploration and Development Area” contains prospects and leads that have been ascribed gross unrisked P50 prospective resources of 266mmboe, according to a Resource Review completed by PanTerra Geoconsultants in February 2018.