South African oil and gas company SacOil on Wednesday announced that it had partnered with multinational oil and gas company Total on the exploration of Block III in the in the eastern part of the Democratic Republic of Congo (DRC), alongside the Uganda border.
Total had committed more than $30-million to the exploration and drilling of the first test well in early 2014, SacOil said, adding that 26 out of 27 holes drilled on adjacent blocks had resulted in rich commercial finds.
“According to oil analysts, this area has a confirmed reserve in excess of 2.5-billion barrels,” the South African company said.
Further, the 20% shareholding held by the company in oil prospecting licence (OPL) 281 in Nigeria had confirmed a 100-million barrels of oil equivalent gross contingent resource, while OPL 233, also in Nigeria, had significant potential to exceed 200-million barrels of resources.
The fist production of oil from OPL 233 would start once the modelling and planning was completed.
Meanwhile, SacOil also announced that it had simultaneously relisted on the main board of the JSE, as well as on the LSE on Monday, following a suspension in May.
The company relisted with a new board and management team, headed by former Reserve Bank governor Tito Mboweni, former Algerian ambassador Mzuvukile Maqetuka and former National Prosecuting Authority head Vusi Pikoli.
The company’s share price on the JSE rose by more than 15.5% on Tuesday in early trading on a volume of more than ten-million shares, while its LSE share price was up by more than 25% on Wednesday, showing positive support by shareholders for an R800-million recapitalisation programme, which would retire the R238-million of debt on SacOil’s balance sheet.
“The recapitalisation will place the company in a cash position of about R570-million and leave it debt free,” SacOil explained.
Mboweni stated that the planned recapitalisation, combined with a strong balance sheet and corporate governance framework, would enable the company to be well positioned to develop the potential of its valuable underlying asset value.