Afentra Pushes the Final Acquisition of Angola’s Block 3/05 by One More Month - Africa’s premier report on the oil, gas and energy landscape.

Afentra Pushes the Final Acquisition of Angola’s Block 3/05 by One More Month

Afentra has named a new date at which it expects the completion of its acquisition of Sonangol’s stake in Block 3/05.

It is the third time it would shift the completion date a little further.

The company is upbeat about the value of the asset: “Recent gross production levels in Block 3/05 has averaged approximately 18,900Barrels of Oil Per Day(BOPD) in May 2023. Water injection levels have averaged approx. 39,000 Barrels of Water Per Day from January through May 2023. Finally, production in Block 3/05A, at the Gazela field, has continued at approximately 1,100BOPD” Afentra announces.

In late 2021, Sonangol, selected 10 companies for purposes of farm down negotiations from six blocks in which it has interests.

In April 2022, Afentra signed Sales and Purchase Agreements (SPAs) with Sonangol to acquire non-operated interests from Sonangol and INA in the producing Block 3/05 (24%), adjacent development Block 3/05A (4%) and exploration Block 23 (40%).

It then entered into financing and offtake agreements with Trafigura to finance the acquisitions through Reserve Based Lending (‘RBL’) facility: up to $75Million with 5-year tenure (8% margin over 3- month secured overnight financing rate (SOFR)).

The acquisition of INA’s stake has been concluded.

But taking over Sonangol’s 20% interest in Block 3/05, which is the crown jewel of the deal, and 40% interest in Block 23, has taken a little time.

“Subsequent to the approval of the licence extension in May 2023, Sonangol (the Angolan state hydrocarbon company) is now pursuing the requisite government approvals for the transaction”, the London headquartered junior says in a recent update.

“Based on the outstanding workstreams and associated timeframes, completion of the transaction is now expected to occur in July 2023 and we are working, together with Sonangol, to extend the long stop date for this acquisition accordingly”, Afentra says in the release.

In addition, the enhanced fiscal terms associated with the Block 3/05 PSA extension have been submitted for the requisite government approvals.

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