Afentra plc is issuing its annual results for the year ended 31 December 2020.
Afentra plc, together with its subsidiary undertakings (the 'Group'), is an upstream oil and gas Company listed on the AIM market of the London Stock Exchange.
The Company has a refreshed strategy built around achieving scale through the acquisition of both operated production assets and discovered resources resulting from the accelerating energy transition in Africa, where the Company and its new management has extensive operational experience. The Company currently has the high potential onshore Odewayne exploration block that is operated by Genel Energy, where its 34% interest is fully carried.
• Throughout 2020: Odewayne block, Somaliland - The Company continued to support the Operator in progressing the technical understanding of the block.
• Afentra continued to review its technical assessment and outlook on block prospectivity.
• Cash resources net to the Group at 31 December 2020 of $42.7 million (2019: $44.9 million).
• The Group remains debt free and fully funded for all commitments.
• Adjusted EBITDAX1: loss for the Group of $761k (2019: $917k loss).
• 2020 focus on capital discipline, general and administrative overheads ('G&A') expenses reduced by 15% to $2.2 million (2019: $2.6 million).
Post year end
• 18 February 2021: Several institutional and high net worth investors purchased the shares sold by Waterford Finance and Investment Limited (equating to its entire 29.23% shareholding in the Company) and Mistyvale Limited (equating to its entire 15.66% shareholding in the Company).
• 16 March 2021: Paul McDade and Ian Cloke join the Board of Directors as CEO and COO respectively.
• 30 March 2021: Jeffrey MacDonald and Gavin Wilson join the Board of Directors as Independent non-executive Chairman and Independent non-executive Director respectively.
• 13 April 2021: The Company announced its intention to change its name from Sterling Energy plc to Afentra plc and adopt new articles of association. The proposed changes were approved at the General Meeting held on 30 April 2021.
• 5 May 2021: Afentra plc launched and Anastasia Deulina is appointed as Chief Financial Officer.
Commenting, CEO Paul McDade, said:
"The last few months have been truly transformational for the Company. I speak for the whole management & Board as I express our excitement as we embark upon our updated strategy targeting scale through the implementation of a buy and build model, focused on the energy transition in Africa. In parallel to our updated strategy we continue to work with our partners in Somaliland to establish additional shareholder value from this existing early stage asset". "I must also thank the Sterling Energy team who despite an extremely challenging year have shown resilience and have, like our shareholders, welcomed the new members to the team. We look forward to 2021 and progressing our strategy as the new Afentra team."
Since late 2015 the Company has exited non-core exploration portfolio assets and removed outstanding liabilities, to provide a simpler and rejuvenated platform for M&A led growth. The Group retains a fully carried exposure to the frontier Odewayne block in Somaliland and a clear strategy for future M&A growth.
Somaliland offers one of the last opportunities to target an undrilled onshore rift basin in Africa. The Odewayne block, with access to Berbera deepwater port less than a 100km to the north, is ideally located to commercialise any discovered hydrocarbons. A 2D geophysical survey acquired in 2017 and reprocessed in 2019, along with field data and legacy geological field studies, are the focus of the Company's 2021 work programme to determine if a Mesozoic age sedimentary basin is present in the block and its prospectivity.
Odewayne (W.I. 34%) Exploration block
This large, unexplored, frontier acreage position covers 22,840km2, the equivalent of c. 100 UK North Sea blocks. Exploration activity prior to the 2017 regional 2D seismic acquisition program has been limited to the acquisition of airborne gravity and magnetic data and surface fieldwork studies, with no wells drilled on block.
The Company's wholly owned subsidiary, Sterling Energy (East Africa) Limited ('SE(EA)L'), holds a 34% working interest in the PSA (fully carried by Genel Energy Somaliland Limited for its share of the costs of all exploration activities during the Third and Fourth Periods of the PSA).
The Odewayne production sharing agreement was awarded in 2005. It is in the Third Period, with a 1,000km, 10km by 10km 2D seismic grid acquired in 2017 by BGP. The Third Period has been further extended, through the 8th deed of amendment. This data was reprocessed in 2019 and is currently being reviewed after the disruption caused by Covid in 2020.
In 2H 2021 the Company will review the reprocessed 2D seismic data set in and will update its technical assessment and outlook on block prospectivity accordingly. Alongside the seismic reprocessing review, the Operator is undertaking a number of work streams and it is anticipated that these will aid the JV partnership in developing an appropriate forward work program to further evaluate the prospectivity of the licence.
Outlook on buy and build strategy
In March 2021 the Company shifted focus to support a responsible energy transition in Africa by establishing itself as a credible partner for divesting IOCs and Host Governments. The Company is specifically targeting producing assets and discovered resources in Africa. The focus will be on operated positions but will also consider non-operated positions alongside credible operators with shared standards.