Oil & Gas Corporate News
Victoria Oil & Gas plc (BUY, £0.12) (VOG, 4.24p, ? 2.66%) announced that the Company has executed a contract with a Cameroon civil engineering contractor, Austin Maritime, for the site civil works and the pipeline trenching, jointing and installation. The contractor mobilised on 31 May and its offices, containers and equipment have been moved to site where excavation commenced on 11 June. The Company has also mobilised horizontal drilling and high density polyethylene pipe, ('HDPE') jointing experts and a pipeline engineer from the UK. Pipeline installation is scheduled to commence before the end of June and involves three construction teams and a horizontal drilling team to complete fourteen horizontal sections. All the equipment required to deliver first gas to customers is now in Douala, either at the EXPRO site, (operators of the processing plant,) at the Douala Port or at VOG's site at Logbaba. The Company has also commenced work on the production trees and baseline caliper logs of the wells to prepare the wells for commissioning. This work will be complete at the end of June. The Company currently has 11 gas sales agreements ('GSAs') signed and executed together with a further 10 GSAs which have been contractually agreed subject to legal due diligence and final approval. Gas supplies in all contacts are priced at $16 per million British thermal units ('btu') or $96 per barrel of oil equivalent. The Company expects gas sales of 8 mmscf/d in the first year of operations rising to 44 mmscf/d by the end of 2014. The pipeline has a capacity of 60 mmscf/d, which is of sufficient size for the Douala industrial market over the medium term. Condensate separated from the gas at the process plant will be stabilised and stored for transport to the Sonara refinery at Limbe in Cameroon. Condensate production is forecast at the rate of 20 barrels per million cubic feet of gas. Logbaba's current proved and probable reserves of 212 Bcf are sufficient to supply an average consumption of 30 mmscf/d for the next 20 years. In the longer term, as further reserves are proven, gas may be supplied to large gas fired power stations connected to the grid, with either VOG investing in an independent power producer joint venture or selling gas to third parties. The Company also announced revised internal economic forecasts for the Logbaba gas and gas condensate field.…
