REG - San Leon Energy PLC - Update on Oza field, Nigeria

San Leon EnergyAnnouncement

20/09/2022 07:00

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RNS Number : 9326Z  San Leon Energy PLC  20 September 2022

 

 

20 September 2022

San Leon Energy plc

("San Leon")

 

Update on Oza field, Nigeria

 

San Leon, the independent oil and gas production, development and exploration
company focused on Nigeria, notes the announcement made on 19 September 2022
by Decklar Resources Inc. ("Decklar") in Canada.  San Leon has a 11%
shareholding in Decklar Petroleum Limited ("DPL"), the local subsidiary of
Decklar operating in Nigeria, and has also made a US$5.5 million loan to DPL,
via 10% per annum unsecured subordinated loan notes.

 

Part of the text of Decklar's announcement is set out below:

 

"Calgary, Alberta -- Decklar Resources Inc. (TSX-V: DKL) (OTCQX: DLKRF) (FSE:
A1U1) (the "Company" or "Decklar")

is pleased to provide an update on operational activities relating to the
transportation and export of crude oil produced from the Oza Oil Field in
Nigeria.

 

Decklar and its co-venturer Millenium Oil & Gas Company Limited
("Millenium") are pleased to announce that the 7,800 barrels of crude oil
("bbls") previously delivered to the Umugini Pipeline Infrastructure Limited
crude handling facilities has now been delivered to the Forcados crude oil
export terminal. The 7,800 bbls are ready for export pending the completion of
certain repairs to the offshore loading system. In the meantime, an additional
30,000 bbls has been produced from the Oza Oil Field and is currently being
stored in tanks at the Oza-1 wellsite. These 30,000 bbls will be the initial
barrels transported to the new export facilities, as detailed below. Once part
of this crude has been shipped from the Oza Oil Field tanks, the Oza-1 well
will be brought back onto production, with the ultimate goal being the
provision of a stable, ongoing supply of crude oil into new alternative export
facilities.

 

Decklar and Millenium are also pleased to announce that an agreement has also
been reached to transport and sell Oza Oil Field crude oil to a company that
owns and operates a small crude oil refinery in Edo State, Nigeria. The
agreement provides for an initial sale of 10,000 bbls. The parties are also in
discussions to increase the sale quantity to 30,000 bbls and to possibly agree
a minimum monthly quantity of barrels of Oza Oil Field crude to be sold to the
oil refinery. It is anticipated that all required government permits will be
finalized and in place in the next 3-4 weeks.

 

Separately, agreements have been executed to truck crude oil from the Oza Oil
Field to a 45,000 barrel tank farm located in Akwete. The short-term goal is
to transport approximately 1,100 barrels of oil per day from the Oza Oil Field
to the storage tanks at Akwete. Once the volumes at the Akwete oil tank exceed
15,000 barrels, barges will load and transport the crude to an offshore
floating storage and offloading unit ("FSO").

 

The barging to an FSO will provide Decklar and Millenium with the ability to
produce and transport larger and more stable volumes of crude oil from the Oza
Oil Field and avoid the use of pipelines in areas that continue to have
problems with availability, delays and losses. While the trucking and barging
of crude oil involves more complex logistics, it is expected to be more
reliable and cost effective than trucking and pipelines. It is anticipated
that the required government permits can be finalized and in place for oil to
start being transported to the Akwete oil storage tank in the next four to
five weeks. All efforts are being made to expedite and complete the necessary
arrangements and obtain the required approvals."

 

Enquiries:

 

 San Leon Energy plc                                +353 1291 6292
 Oisin Fanning, Chief Executive

 Julian Tedder, Chief Financial Officer
 Allenby Capital Limited                            +44 20 3328 5656

 (Nominated adviser and joint broker to San Leon)
 Nick Naylor

 Alex Brearley

 Vivek Bhardwaj
 Panmure Gordon & Co                                +44 20 7886 2500

 (Joint broker to San Leon)
 James Sinclair-Ford
 Tavistock                                          +44 20 7920 3150

 (Financial Public Relations)
 Nick Elwes

 Simon Hudson
 Plunkett Public Relations                          +353 1 230 3781
 Sharon Plunkett

 

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