MX Oil raises further £500,000 to develop Aje Field Project
by DIPO OLADEHINDE
February 23, 2018 | 12:57 am| | | Start Conversation
London based AIM-listed MX Oil announced it has raised £500,000 before expenses via a placing of 100 million new ordinary shares at a price of 0.5 pence per share for the further development of the Aje project.
Application has been made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. It is expected that Admission will become effective and that dealings in the Placing Shares on AIM will commence on or around 6 March 2018.
“I am very pleased that investors continue to be supportive and these new funds will go towards the further development of the Aje project. I very much look forward to providing an update on the first phase of this work which will be the completion of the CPR in March 2018,” Stefan Oliver CEO of MX Oil Plc, said.
AIM, the London Stock Exchange’s international market for smaller growing companies; a wide range of businesses including early stage, venture capital backed as well as more established companies join AIM which is also the most successful growth market in the world, seeking access to growth capital.
“This capital inflow will increase the funds for developing the Aje field,” said Emmanuel Afimia, Energy Economist at Afimia Consulting Services.
The Aje field within the OML 113 licence area commenced production in May 2016 and is expected to achieve a plateau production ranging between 50,000 and 80,000 barrels of oil a day.
OML 113 covers an area of 835 sq km offshore Nigeria close to the Benin border and holds the Aje field as well as a number of exploration prospects. Aje, which was discovered in 1997, has multiple oil, gas and gas condensate reservoirs in the Turonian, Cenomanian and Albian sandstones, similar to the producing Jubilee field offshore Ghana. To date five wells have been drilled: Aje-1 and Aje-2 both flow tested oil and gas condensate at high rates, while Aje-4 intersected significant pay in four productive reservoirs. Aje-4 and the recently drilled Aje-5 have both been completed.
MX Oil also provided an update with regard to OML 113, the offshore licence in Nigeria, in which it has an investment.
One of the two current production wells, Aje-5, has been producing from the Turonian Oil Rim since May 2017. Based on the data gathered from this well, MX Oil now believes there are significant oil volumes to recover from this interval which it believes will be confirmed by the updated Competent Persons Report (CPR) and the development of an integrated oil and gas development plan of the Turonian reservoir is now being discussed.
Field production has now stabilised at around 3,300 barrels of oil per day and on the basis of this level of production, combined with a focus on reducing operational expenditure MX Oil has calculated that lifting costs are currently around US$40 per bbl.
Nigeria had earlier approved the Aje Field Development Plan (FDP) in March 2014 and by October 2014; the Final Investment Decision (FID) for the project was agreed. The FDP involves a three phase development programme. Phase 1 will focus on the Aje Cenomanian oil reservoir and include the tie-back of two existing subsea wells and a leased Floating Production Storage and Offloading vessel (“FPSO”). Phase 1 production commenced in May 2016. The planning for Phase 2 is now underway and will see additional wells drilled in order to increase total Cenomanian oil production. Phase 3 will target the development of the Turonian gas condensate reservoir.
On the direct implication of this deal; “Nigeria’s foreign exchange reserve will expand thereby strengthening its economy. Also, this inflow of investment capital will lead to an increase in both direct and portfolio investment in Nigeria,” Afimia Said by Phone.
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