CALGARY, March 9, 2015 /CNW/ - Oando Energy Resources Inc. ("OER" or the "Company") (TSX: OER), a company focused on oil and gas exploration and production in Nigeria, today announced the completion of all civil and pipeline works associated with the Qua Iboe field, and associated crude delivery and sales infrastructure, with commercial production at 2,150 boepd Gross.
Oando Energy Resources holds a 40% working interest in the field. In its capacity as technical services provider, OER, together with the operator and 60% owner, Network Exploration and Production Nigeria Limited (NEPN), brought the field from conceptualization, through development, to first oil delivery. The commercial oil production from the field's reservoirs has now commenced at an initial rate of 2,150boepd gross to the partners. The crude processing facility was commissioned in the fourth quarter of 2014 but commercial production was delayed until the completion of the associated cluster crude delivery and sales infrastructure into the Qua Iboe Terminal.
"We are delighted to have achieved this milestone, having taken this field through the full cycle of asset development, from drilling to facility engineering, construction and commissioning, and also increasing our organic production contribution from our portfolio," said Pade Durotoye, CEO Oando Energy Resources. "We will now be focusing our attention on maturing the potential of this field through seismic acquisition and interpretation, and a possible multi-well drilling program. We hope the Qua Iboe field will follow in the footsteps of our successful Ebendo field, where production has increased from 900bopd (gross) at inception to over 7,500bopd (gross) through the identification and drilling of new reservoirs in the field."
The Company identified the asset in 2012 and an agreement was reached with NEPN for OER to technically lead and fund certain aspects of NEPN's costs until first oil. Consequently, post recovery of all loan repayments, OER is entitled to 90% of NEPN's sales proceeds from its 60% share of crude oil production until NEPN's obligation is paid in full, with OER earning an additional 10% fee on the funded amount.
Qua Iboe is located at the mouth of the Qua Iboe River in the eastern Niger Delta and covers an area of 14 km2 (3,459 acres). The field is immediately adjacent to the ExxonMobil Qua Iboe Terminal.
About Oando Energy Resources Inc. (OER)
OER currently has a broad suite of producing, development and exploration assets in the Gulf of Guinea (predominantly in Nigeria). OER's sales production was 53,161 boe/d for the month ending January 31, 2015.
Oil and Gas Equivalents
Production information is commonly reported in units of barrel of oil equivalent ("boe" or "Mboe" or "MMboe") or in units of natural gas equivalent ("Mcfe" or "MMcfe" or Bcfe"). However, boe's or Mcfe's may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf = 1 barrel, or a Mcfe conversion ratio of 1 barrel = 6 Mcf, is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Readers are cautioned that boe may be misleading, particularly if used in isolation.
Forward Looking Statements:
This news release contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends" and similar expressions are intended to identify forward-looking information or statements. In particular, this news release contains forward-looking statements relating to intended acquisitions.
Although the Company believes that the expectations and assumptions on which such forward-looking statements and information are reasonable, undue reliance should not be placed on the forward-looking statements and information because the Company can give no assurance that such statements and information will prove to be correct. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties.
Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to: risks related to international operations, the integration of assets acquired under the COP acquisition, the actual results of current exploration and drilling activities, changes in project parameters as plans continue to be refined and the future price of crude oil. Accordingly, readers should not place undue reliance on the forward-looking statements. Readers are cautioned that the foregoing list of factors is not exhaustive.
Additional information on these and other factors that could affect the Company's financial results are included in reports on file with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com) under the Company. The forward-looking statements and information contained in this news release are made as of the date hereof and the Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
SOURCE Oando Energy Resources Inc.
For further information: Pade Durotoye, CEO, Oando Energy Resources Inc., [email protected], +1 403-561-1713; Tokunboh Akindele, Head Investor Relations, Oando Energy Resources Inc., [email protected], +1 403-560-7450