Mar 18, 2011
SacOil to start trading on Aim next monthBack
DRC|London|Africa|Exploration|Projects|SacOil|Semliki Energy|Africa|Democratic Republic Of Congo|DRC|United Kingdom|GBP|Energy|Oil And Gas|Oil And Gas Transactions|Oil Block|Colin Bird|Robin Vela
© Reuse this
The South African Reserve Bank approved the admission, which is expected on April 8. The company, which has a primary listing on the JSE, is expected to list with a market capitalisation of £156-million (about R1,7-billion).
Vela says that the secondary listing will allow SacOil to be evaluated against a number of its peers, which would allow a real comparable pricing for its stock. Companies are regarded as peers in terms of their stage of development, their focus on African acreage and the fact that they are pure-play upstream, some with an indigenisation feel.
He adds that the board intends to attract new UK institutional investors and raise its public profile to ensure that it remains sufficiently capitalised to further develop current exploration projects and execute near-production and producing-asset oil and gas transactions in the pipeline.
Last week, SacOil announced that French oil and gas major Total would buy a big stake in its Democratic Republic of Congo (DRC) oil block.
Vela notes that the announcement led to shares in SacOil climbing 24% to 257c a share at the close of business on March 7.
Before the transaction, SacOil subsidiary Semliki Energy held an 85% share of the block and the DRC government the balance. After the transaction, Total will own a 60% interest in the explo- ration permit for Block III, Semliki 25% and the DRC government 15%.
All conditions precedent have been satisfied, apart from the transaction being approved by shareholders. The intention is to complete the Total deal by the end of March.
SacOil will receive $7,5-million in cash upfront, followed by $54-million, which will be paid in two stages.
SacOil states that it is financially derisked in Block III as Total carries its entire exploration expenditure obligations until a final investment decision. It is also technically and oper- ationally derisked with Total as operator.
SacOil executive director Colin Bird says that Total has removed the two key risks that a junior and its shareholders have in the DRC, namely poor execution and financing.
“In SacOil’s early stages of development, it is important that, whatever acreage it gets, it is able to work up to production in as short a time as possible,” says Vela.
To do so, the company needs a partner that can provide transfer of skills, operate the block and derisk the asset as far as possible – Total met these requirements, he adds.
Edited by: Martin Zhuwakinyu© Reuse this Comment Guidelines (150 word limit)
Other Energy News
Recent Research Reports
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
This Week's Magazine
South Africa remains an important manufacturing and export platform for Ford Motor Company, says executive chairperson Bill Ford. However, he adds that other countries on the continent are “becoming interesting”, and that the US carmaker is casting its net wider for...
Germany’s Max-Planck-Society (MPG) and the Max-Planck-Institute for Radio Astronomy (MPlfR) are investing €11-million (about R150-million) into South Africa’s MeerKAT radio telescope array programme. The money will be used to design, build and install S-band radio...
Infrastructure spend in sub-Saharan Africa will grow from $70-billion in 2013 to $180-billion by 2025, says PwC capital projects and infrastructure Africa leader Jonathan Cawood. This is one of the findings of PwC’s Capital Projects & Infrastructure report on East...
Private-owned defence and aerospace manufacturer Paramount Group and the Ichikowitz Family Foundation unveiled its Anti-Poaching Skills and K9 Training Academy in Magaliesburg last month.
The inclusion of Bluetooth to provide sub-three meter accuracy and heightened functionality for users is one of the ways to change existing wireless networks into engagement networks. An engagement network differs from common wireless networks in that it enables the...