Africa Finance Corp. (AFC) invested $100 million in Aker Energy this month, serving as another indicator that Aker Energy is moving toward its initial public offering (IPO). The company announced its intent in February and said the IPO was expected to take place after it submitted a plan for development and operations (PDO) for the deepwater Pecan field off Ghana.
The bonds issued to AFC will be converted to equity in the event of an IPO.
The company, a subsidiary of the Norwegian Aker Group, submitted the $4.4-billion PDOto Ghana authorities in March, followed by an updated PDO at the end of June, and is now waiting for its approval and is targeting a final investment decision in the second half of 2019.
Founded in 2018, Aker Energy is positioning itself as an exploration and production company and the offshore oil and gas operator of choice in Ghana.
It holds a 50% participating interest in the Deepwater Tano Cape Three Points block (DWT/CTP), covering approximately 2,010 km2 in a prolific petroleum region approximately 70 miles offshore Ghana. The Pecan field, the largest discovery in the DWT/CTP block, is located 115 km offshore Ghana in water depths ranging from 2400 to 2700 m. It will be the fourth producing field offshore Ghana and the first stage in the company’s Ghana activities.
Aker Energy plans to develop the field with a floating production, supply, and offloading vessel tied to up to 26 subsea wells. Plans include 14 advanced, horizontal oil producers and 12 injectors with alternating water and gas injection, and the use of multiphase pumps as artificial lift, to maximize oil production.
The proceeds from the bonds are part of Aker Energy’s financing for the development of DWT/CTP. AFC also intends to take part in other capital market activities initiated by Aker Energy in the future.
Samaila Zubairu, president and CEO of AFC, said, “Partnerships with financially and technically strong sponsors is a key component of our natural resources strategic focus. We are therefore delighted to be announcing this transaction with Aker Energy, which, through the Aker Group, has an outstanding track record of executing complex offshore projects like DWT/CTP block in Ghana.”
Total reserves at the Pecan field are estimated at 334 million bbl of oil. Aker Energy said production could start in about 3 years after the PDO is approved. The field also holds 110 to 210 million BOE in contingent resources. The total resource potential in the area is within the range of 600–1,000 million BOE.
During Aker AS’s Q2 2019 update on 18 July, CEO Øyvind Eriksen said estimates based on an appraisal drilling campaign were that the Pecan South well holds an additional 5 to 15 million bbl, while the Pecan South East well is most likely not commercial.
Aker Energy’s partners in the block are Lukoil (38%), Ghana National Petroleum Corp. (10%), and Fueltrade (2%).
