REG - Savannah Energy Plc - Operational and Financial Update

Savannah EnergyAnnouncement

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RNS Number : 0473N  Savannah Energy Plc  30 December 2025

30 December 2025

Savannah Energy PLC

("Savannah" or "the Company")

 

Operational and Financial Update

Savannah Energy PLC, the British independent energy company focused around the
delivery of Projects that Matter is pleased to provide the following
operational and financial update for the 11 months ("11M") to 30 November
2025. All figures are unaudited.

Andrew Knott, CEO of Savannah, said:

"Throughout 2025, Savannah has made solid progress across the nine focus areas
we set out at the beginning of the year. In Nigeria, we increased our rate of
cash collections year-on-year and made significant progress in refinancing our
debt facilities.

Operationally, the completion of the SIPEC acquisition in March enabled us to
commence an expansion programme at Stubb Creek, with production already
materially above 2024 levels. At Uquo we delivered the new compression system
under budget and advanced site construction ahead of planned drilling in early
2026. Earlier in the year, we also reported a 21% 2P Reserves upgrade at the
Uquo gas field and a 29% upgrade to Stubb Creek oil field 2P Reserves. In
Niger, we remain actively engaged with the Government on future activity, with
the R3 East development plan significantly enhanced during the year.

In the power sector, we have repositioned our business model and advanced both
operating and development opportunities, including the proposed acquisition of
interests in three East African hydropower projects, alongside continued
progress on our wind, solar and hydro portfolio. We continue to pursue further
value-accretive acquisitions across both hydrocarbons and power, with several
other opportunities under active discussion. We have also continued to
progress our arbitration claims, with the Savannah Chad Inc ("SCI") and
Savannah Midstream Investment Limited ("SMIL") proceedings currently expected
to be concluded in the first half of 2026.

Collectively, this progress provides a strong platform for continued execution
in 2026. I would also like to take this opportunity to thank my incredibly
dedicated and passionate colleagues, as well as our host governments,
communities, local authorities and regulators, shareholders, lenders,
customers, suppliers and partners for their continued support. Thank you
all."

Highlights

Operational

·      11M 2025 average gross daily production of 19.1 Kboepd (11M 2024:
22.8 Kboepd), of which 84% was gas (11M 2024: 88%)(1). Following completion of
the SIPEC Acquisition in March 2025, commenced an 18-month expansion programme
that has already seen Stubb Creek gross daily production increase to 3.3
Kbopd, approximately 24% above the 2024 average;

·      Well site construction for the Uquo NE development well is
expected to be completed by the end of December, with an anticipated spud date
in January 2026 and first gas targeted by the end of Q1 2026;

·      Well site preparation has commenced on the Uquo South exploration
well;

·      New compression system at the Uquo Central Processing Facility
("CPF") completed and fully commissioned. This project, which was delivered
safely and approximately 10% under the original US$45 million budget, is
expected to allow us to maximise the production from our existing and future
gas wells;

·      Gas contract extension agreed with the Central Horizon Gas
Company Limited ("CHGC") to end December 2026 for up to 10 MMscfpd;

·      The previously announced proposed acquisition of indirect
interests in three East African hydropower projects is targeted to complete in
Q1 2026. The assets include the 255 MW Bujagali power plant, with a 13-year
operating and payment track record, and two advanced-stage development
projects, marking Savannah's potential for entry into five new countries -
Uganda, Burundi, the Democratic Republic of the Congo (the "DRC"), Malawi and
Rwanda;

·      Continuing to progress our existing priority Power Division
projects, including the up to 250 MW Parc Eolien de la Tarka wind farm project
in Niger and the up to 95 MW Bini a Warak hybrid hydroelectric and solar
project in Cameroon;

·      Subject to a satisfactory agreement being reached with the
Government of Niger, our subsidiary is considering commencing a four-well
testing programme and/or a return to exploration activity in the R1234 PSC
contract area in 2026/27; and

·      Actively reviewing opportunities in both the thermal and
renewable power sector, with the expectation of announcing transaction(s)
currently under consideration over the course of the next 24 months in the
African power space.

Financial (unaudited)

·      11M 2025 Total Revenues(2) of US$218.1 million (11M 2024:
US$226.7 million) and 11M 2025 cash collections of US$260.8 million, an
increase of 5.5% on the prior year (11M 2024: US$247.3 million);

·      As at 30 November 2025, cash balances were US$59.8 million (31
December 2024: US$32.6 million) and net debt stood at US$652.5 million (31
December 2024: US$636.9 million). Gross debt as at 30 November 2025 was
US$715.3 million of which only US$39.3 million (5.5%) was recourse to the
Company, with the balance sitting within subsidiary companies on a
non-recourse basis;

·      The Trade Receivables balance as at 30 November 2025 was US$506.9
million, a 5.9% improvement on year-end 2024 (31 December 2024: US$538.9
million); and

·      Following the previously announced increase in the Accugas debt
facility from NGN340 billion to up to approximately NGN772 billion (the
"Transitional Facility"), as at 30 November 2025, there was a remaining
principal balance under the US$ Facility of approximately US$25 million. It is
expected that the remaining residual principal amount outstanding will be
fully repaid within the permitted tenor of the US$ Facility.

Operational Update

Hydrocarbons Division

Average gross daily production was 19.1 Kboepd for 11M 2025 (11M 2024: 22.8
Kboepd), of which 84% was gas (11M 2024: 88%)(1);

On 10 March 2025, we announced the completion of the SIPEC Acquisition.
Following completion, we commenced a planned production expansion programme
that has already seen Stubb Creek gross daily production increase to 3.3
Kbopd, approximately 24% above the 2024 average. The full programme, expected
to take up to 18 months, is anticipated to raise gross production to as much
as 4.7 Kbopd. In parallel, we are evaluating an alternative, lower capex
option that could deliver a faster production ramp up, with plateau production
sustained for a longer period at a slightly lower rate than under the original
expansion programme.

The compression project at the Uquo CPF was completed and fully commissioned.
This project, which was delivered approximately 10% under the original US$45
million budget, is expected to allow us to maximise the production from our
existing and future gas wells.

The Company's Accugas subsidiary agreed a contract extension with CHGC to end
December 2026 to supply up to 10 MMscfpd of gas. This represents the fourth
such extension to the original contract signed with CHGC in February 2022.
CHGC is a major gas distribution company situated in the South-South region of
Nigeria, operating a 17 km gas pipeline infrastructure network providing
natural gas to industrial and commercial users in the Trans Amadi Industrial
Area of Port Harcourt as well as the greater Port Harcourt Area, Nigeria.

Well site construction is in the final stages for the Uquo NE development well
and is expected to be completed this year. This follows the earlier signing of
a turnkey drilling contract in preparation for a planned two-well drilling
campaign on the Uquo Field. Drilling for Uquo NE is scheduled to begin in
January 2026, with first gas targeted by the end of Q1 2026 and forecast to
deliver gas volumes of up to 80 MMscfpd. Well site preparation has also
commenced on the Uquo South exploration well, which is targeting an Unrisked
Gross GIIP of 131 Bscf of incremental Prospective gas Resources on the Uquo
licence area.

The Company notes the supportive public statements made by various officials
of the Government of Nigeria during 2025 regarding the Nigerian electricity
sector, stating that His Excellency President Bola Tinubu has approved a
US$2.6 billion financing package to assist companies operating within the
power industry settle outstanding verified invoices to power generation
companies ("Gencos") and subsequently to gas supply companies. In this regard,
the Government successfully launched a NGN590 billion first tranche bond
issuance in Q4 2025, as part of a wider NGN4 trillion bond programme to settle
verified legacy invoices owed to Gencos and gas suppliers. This has created
renewed positive momentum in the discussions Accugas Ltd, an 80% Savannah
owned subsidiary, is having with its offtakers that are Gencos around the
repayment of the Company's outstanding receivables balance in an accelerated
manner.

 

We continue to actively engage with the Government of Niger around our forward
work programme plans in country. Subject to a satisfactory agreement being
reached with the Government, our subsidiary is considering commencing a
four-well testing programme and/or a return to exploration activity in the
R1234 PSC contract area in 2026/27. The R3 East development plan, itself, has
been significantly re-worked since the last published Niger Competent Persons'
Report ("CPR") of December 2021, with a plateau production rate of around 10
Kbopd now assumed (previously 5 Kbopd). The Company has updated its internal
management estimates of the potential PV10 value (on an unrisked basis) at an
asset level basis for R3 East to US$184.4 million (vs the last CPR asset value
estimate of US$150 million). Assuming a successful well test programme is
conducted, we would look to accelerate plans to commence commercial oil
production from the R3 East Area and intend to incorporate the data acquired
into our field development plan.

Power Division

In 2025, we have repositioned our power sector business model to pursue
operating asset opportunities in both the thermal and renewable energy spaces
alongside interests in large scale renewable energy development projects.

Proposed Acquisition of Three East African Hydropower Projects

On 19 September 2025, we announced the proposed acquisition of interests in
three East African hydropower projects with the signing by our wholly owned
subsidiary, Savannah Energy EA Limited, of a Share Purchase Agreement ("SPA")
with Norfund, the Norwegian investment fund for developing countries, to
acquire its current 50.1% interest in Klinchenberg for a total consideration
of up to US$65.4 million (the "Klinchenberg Transaction"). Klinchenberg has
interests in a portfolio of hydropower assets, as set out below:(3)

·      an indirect 13.6% interest in the operating 255 MW Bujagali
run-of-river hydropower plant ("Bujagali") in Uganda;

·      an indirect 12.3% interest in the 361 MW Mpatamanga hydropower
development project ("Mpatamanga") in Malawi; and

·      an indirect 9.8% interest in the 206 MW Ruzizi III hydropower
development project ("Ruzizi III") spanning Burundi, the DRC and Rwanda.

The Klinchenberg Transaction is targeted to complete in Q1 2026.

Existing Projects

We continue to progress our existing portfolio of wind, solar and
hydroelectric projects, with our principal focus projects being on the up to
250 MW Parc Eolien de la Tarka project in Niger and the up to 95 MW Bini a
Warak hybrid hydroelectric and solar project in Cameroon.

Our Parc Eolien de la Tarka project has made significant progress in the year
to date, with the Minister of Energy confirming that the project is on the
Government's list of priority projects and, as such, is included in the Niger
Energy Compact document adopted in Dar es Salaam during the Mission 300 Africa
Energy Summit
(https://www.google.com/search?q=Mission+300+Africa+Energy+Summit&sca_esv=cf3d8fcadb69d60c&rlz=1C1YTUH_en-GBGB1082GB1082&sxsrf=AE3TifMDO69t79Z-F8QxxQVXSOI1VEvSqw%3A1765909360022&ei=cKNBaaOOAdmL-d8PuaaV8Q4&ved=2ahUKEwij6faK3cKRAxV_U0EAHfZPIQkQgK4QegQIARAE&uact=5&oq=M300+conference&gs_lp=Egxnd3Mtd2l6LXNlcnAiD00zMDAgY29uZmVyZW5jZTIGEAAYFhgeMgYQABgWGB4yBhAAGBYYHjIFEAAY7wUyBRAAGO8FMgUQABjvBTIFEAAY7wUyCBAAGIAEGKIESIkgUABY3R5wAHgBkAEAmAF5oAHyCaoBBDE0LjG4AQPIAQD4AQGYAg-gAuEKwgIKECMYgAQYJxiKBcICChAuGIAEGEMYigXCAhAQABiABBixAxhDGIMBGIoFwgIFEC4YgATCAgoQABiABBhDGIoFwgILEC4YgAQYsQMYgwHCAhEQLhiABBixAxjRAxiDARjHAcICCxAAGIAEGLEDGIMBwgIIEAAYgAQYsQPCAg4QABiABBixAxiDARiKBcICBRAAGIAEwgILEAAYgAQYhgMYigWYAwCSBwQxMi4zoAfsUrIHBDEyLjO4B-EKwgcGMC4xLjE0yAdUgAgA&sclient=gws-wiz-serp&mstk=AUtExfDZ3BsmtI93pnkXG_5wbPG9goPAldjiB8c8P8oV1ZmLw3iMDSN3urvz7ci8La9P8wDTcZFu5JaUBRdId6LB3YviSxsnqbS47KWkYkCD3RmWGM7s--I1CNnWOxAOgKahNK3A3wYStluB2CHyo6BzVRa3XQ9Yia-0KKeJNcn0XNMy6S3g7JVFLsfHUqj9-M5HNP-JUKPfChgg6hYhxQSuwMrjwcUEqOYK_lTX-a-o1z6LXuiBKeHSDUEYfR6AOuVJIrYnqUjAr7cfMxCQ_lSG5r5SWfXWBtunFMdw_dm2IW8HLA&csui=3)
held in January this year. We are continuing to progress the Environmental and
Social Impact Assessment which we expect to complete and submit to the
relevant authorities in early 2026. Having officially obtained favourable
opinions for the project from both the regulator and the strategic agency in
charge of PPPs, we continue to seek to negotiate outline terms in relation to
the project's proposed power purchase agreement and continue to work on the
project in close collaboration with the International Finance Corporation
(World Bank) and the US International Development Finance Corporation.

Negotiations with the Government of Cameroon are at an advanced stage
regarding a Joint Development Agreement for the up to 95 MW Bini a Warak
hybrid hydroelectric and solar project. This is expected to replace the
Memorandum of Agreement signed in April 2023 and secure the terms under which
Savannah will collaborate with the Government of Cameroon to develop the
project further. We also plan to introduce a development partner to the
project, alongside Savannah, during the next development phase.

Future M&A Activity

The Company continues to view mergers and acquisitions activity as a core
driver of potential future value creation and is actively pursuing
opportunities across both the hydrocarbon and renewable energy sectors.

Savannah is in an exclusivity period in respect of the proposed acquisition of
majority interests in a portfolio of renewable projects located in Sub-Saharan
Africa, with an aggregate gross capacity in excess of 100 MW and a strong
payment history. The proposed acquisition would also include a portfolio of
renewable development projects in the same country with a targeted gross
capacity of approximately 40 MW. The transaction, which remains subject to the
execution of long-form documentation and other customary conditions, is
envisaged to involve a potential gross consideration in the US$70 million to
US$90 million range and would be expected to be funded through a combination
of debt and cash resources.

This proposed acquisition represents the most advanced transaction currently
being progressed by Savannah. However, shareholders are advised that there can
be no certainty that the transaction will proceed on the above summarised
terms or be completed at all. The Company maintains an active business
development pipeline comprising a number of potential transactions at various
stages of evaluation, although no other opportunities have, at this stage,
reached such a level to necessitate disclosure under applicable regulations.
The Business development pipeline is sufficiently large that we are however
confident of announcing further transaction(s) over the course of the next 24
months in the African oil and gas and power space.

Financial Update (unaudited)

11M 2025 Performance Highlights

11M 2025 Total Revenues(2) were US$218.1 million (11M 2024: US$226.7 million)
and 11M 2025 cash collections were US$260.8 million, an increase of 5.5% over
the comparable prior year period (11M 2024: US$247.3 million).

As at 30 November 2025, cash balances were US$59.8 million (31 December 2024:
US$32.6 million) and net debt stood at US$652.5 million (31 December 2024:
US$636.9 million). This included debt associated with the SIPEC Acquisition
and, for comparison purposes, if this were excluded, net debt would have
further reduced to US$609.4 million. It should be noted that only 5.5% of
outstanding debt as at 30 November 2025 was recourse to Savannah, with the
balance sitting within subsidiary companies on a non-recourse basis.

The Trade Receivables balance as at 30 November 2025 was US$506.9 million, a
5.9% improvement on year-end 2024 (31 December 2024: US$538.9 million). This
relates primarily to amounts due under various gas sales agreements in
Nigeria. Delivering an increase in our rate of cash collections in Nigeria
remains a key focus area for the business in 2026.

Debt Facilities

In January 2024, a NGN 340 billion term facility was signed by Accugas with a
consortium of five Nigerian banks (the "Transitional Facility"). This facility
was fully utilised earlier this year with the resulting funds converted to
US$, which, along with cash held, was used to partially prepay the existing
Accugas US$ Facility. In October 2025, we signed agreements with the
consortium of five Nigerian banks to increase the Transitional Facility to up
to approximately NGN772 billion enabling the remaining outstanding US$ balance
to be converted into Naira. As at 30 November 2025, there was a remaining
residual principal amount outstanding under the US$ Facility of approximately
US$25 million, which is expected to be fully repaid within the permitted tenor
of the US$ Facility. This process, when complete, is expected to align
Accugas' debt facility with the currency in which gas revenues are received.

Arbitration Update

Our wholly owned subsidiary, SCI, commenced arbitral proceedings in 2023
against the Government of the Republic of Chad in response to the March 2023
nationalisation of SCI's rights in the Doba fields in Chad, and other breaches
of SCI's rights. Another wholly owned subsidiary, SMIL, commenced arbitral
proceedings in 2023 in relation to the nationalisation of its investment in
TOTCo, the Chadian company which owns and operates the section of the
Chad-Cameroon pipeline located in Chad. SMIL has also commenced arbitral and
other legal proceedings for breaches of SMIL's rights in relation to COTCo,
the Cameroon company which owns and operates the section of the Chad-Cameroon
pipeline located in Cameroon. We currently expect these arbitral proceedings
to be concluded in the first half of 2026.

SCI and SMIL are claiming in excess of US$775 million (plus interest which is
currently estimated at in excess of US$215 million and costs) for the
nationalisation of their rights and assets in Chad.(4) SMIL has a claim valued
at approximately US$330 million (plus interest which is currently estimated at
in excess of US$67 million plus costs) for breaches of its rights in relation
to COTCo.(5) Whilst the Government of the Republic of Chad has acknowledged
SCI's and SMIL's right to compensation, no compensation has been paid by the
Government of the Republic of Chad to date. Savannah remains ready and willing
to discuss with the Government of the Republic of Chad an amicable solution to
the disputes. However, in the absence of such discussions, SCI and SMIL intend
to vigorously pursue their rights in the arbitrations.

SCI is involved in further arbitral proceedings in which designates of
Société des Hydrocarbures du Tchad allege breaches by SCI of the Doba fields
joint operating agreement.(6) SCI is defending the claims vigorously. We
currently expect these arbitral proceedings to be concluded in H2 2026.

 

For further information, please refer to the Company's website
www.savannah-energy.com or contact:

 

Savannah
Energy
                                 +44 (0) 20 3817
9844

Andrew Knott, CEO

Nick Beattie, CFO

Sally Marshak, Head of IR & Communications

 

Strand Hanson Limited (Nominated Adviser)
            +44 (0) 20 7409 3494

James Spinney

Ritchie Balmer

Rob
Patrick
 

 

Cavendish Capital Markets Ltd (Joint Broker)
            +44 (0) 20 7220 0500

Derrick Lee

Tim Redfern

 

Panmure Liberum Limited (Joint
Broker)
+44 (0) 20 3100 2000

Scott Mathieson

James Sinclair-Ford

 

Camarco
            +44 (0) 20 3757 4983

Billy Clegg

Owen Roberts

Violet Wilson

 

 

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018, as amended.

 

About Savannah:

Savannah Energy PLC is a British independent energy company focused around the
delivery of Projects that Matter in Africa.

 

Footnotes

(1.) Note that gas production levels are largely driven by customer nomination
levels, while cash collections are largely driven by contractual maintenance
adjusted take-or-pay provisions of 117 MMscfpd in aggregate.

( )

(2.) Total Revenues are defined as the total amount of invoiced sales during
the period. This number is seen by management as more accurately reflecting
the underlying cash generation capacity of the business as opposed to Revenue
recognised in the Condensed Consolidated Statement of Comprehensive Income.

( )

(3.) All interests presented on an expected net to Savannah basis. Prior to
completion of the Klinchenberg Transaction, it is expected that Klinchenberg
will be restructured, such that Norfund will hold 100% of Klinchenberg and
BII's indirect interests in Bujagali, Mpatamanga and Ruzizi will be moved to a
new vehicle. At completion of the Klinchenberg Transaction, Savannah is,
therefore, expected to acquire 100% of Klinchenberg.

( )

(4.) The Republic of Chad has filed certain counterclaims in these
proceedings, claiming in aggregate approximately US$699.1 million (without
interest and costs). SCI and SMIL believe these counterclaims are baseless and
without merit.

 

(5.) The Republic of Chad, SHT Overseas Petroleum (Cameroon) Limited (SHT),
COTCo and certain other shareholders of COTCo have filed counterclaims in
these proceedings, claiming in aggregate approximately US$58.7 million
(without interest and costs). SMIL believes these claims are baseless and
without merit.

 

(6.) The designates of Société des Hydrocarbures du Tchad have advanced
various claims and seek an aggregate of between US$110.9 to US$136.9 million
(without interest and costs). SCI believes the claims are baseless and without
merit.

 

 

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