Victoria O&G Output Bounces Back in Cameroon (Update)

(Adds gas price details)

Cameroon-focused Victoria Oil & Gas more than doubled gas production in Q1 2019 compared with the previous quarter, with the return of major buyer Eneo December 22, it said May 9. 

Output averaged 10.10mn ft³/day (gross), as the state-owned power generator Eneo consistently took over 5.5mn ft³/day; and reached a peak of 12.85mn ft³/day. Of the total, 57% is attributable to VOG subsidiary Gaz du Cameroun. Eneo pays just under $7/mn Btu.

VOG also signed two new customer gas sales agreements, with effect from Q4 2019 and mid-2020. Eneo however still owes $3.6mn and the two are working on a solution to this problem, alongside the government.

VOG also completed a £13.57mn ($17.4mn) gross fundraising exercise to strengthen its financial position and provide a stable production growth platform for attracting new customers. The cash will go towards completing Well La 108 at Logbaba. It has lost the first round of an insurance claim over that well but it has evidence that there was an underground blow-out, and might pursue the insurer through the Cameroon court, it said. It is also in talks with Weatherford, which is seeking payment of $2.9mn for drilling services in La 107 and La 108. 

Funds will also go on the planning of the Matanda project, a key focus; but VOG will continue to implement its cost reduction programme in both the London and Cameroon operations, it said.

Executive chaiman Kevin Foo was replaced by Roger Kennedy on his retirement; and John Daniel and John Knight were appointed independent non-executive directors.

Kennedy said that the company had posted a “strong set of Q1 19 production figures.” He added: “VOG is in a much improved financial and operational position. As the only onshore gas supplier and operator of a gas pipeline network, we are well placed to take advantage of the increasing gas demand in Douala, Cameroon.”