MX Oil to Invest in OML 113’s Aje Field

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AIM quoted oil and gas investment company, MX Oil has reached agreement with Austrialian company, Jacka Resources, to invest in an indirect, non-operated, 5 percent revenue interest in the OML 113 licence, offshore Nigeria, which includes the Aje Field. The interest in OML 113 is held by ASX listed Jacka through wholly owned subsidiaries.

The field is at a substantial development stage project with proven, flow-tested discoveries where production is expected by January 2016. Initial targeted peak production is 11,000 barrels of oil per day (bodpd), rising to 19,000 bopd in Phase 2. The company said this investment was in line with its strategy to acquire high impact near term production assets in proven oil and gas jurisdictions to build a cash generative platform.

The 5 percent interest is valued at US$55.1 million NPV (0) or US$31.5 million NPV (10) based on a recently completed CPR assuming US$70 oil price. MX Oil is expecting to raise $11.5 million of additional funds to cover the capital expenditure to get to first oil. They expect to finance this by way of a non-dilutive debt facility. The company also expects to do a further fund raise for Phase 2 and Phase 3 will require additional investment, much of which is anticipated to come from revenue from oil sales.

In addition, the company announced the issue of 133,333,333 new ordinary shares via a placing at 4.5p per share to raise £6 million before expenses to provide additional working capital and funding for future capital expenditure and investment.

Stefan Olivier, MX Oil’s Chief Executive Officer said, “This is a game-changing acquisition for MX Oil. It accelerates our transformation into a highly cash generative oil and gas investment company. Alongside expected production in Nigeria by January 2016, the next six months promise a great deal of news flow which should excite our shareholders, as we look to create a leading oil and gas company.”

Culled from the Oil and Gas Intelligence

— Jul 22, 2015 @ 17:45 GMT

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