Nigeria: Lekoil Terms 2019 as Pivotal Year, Released Audited Results

Operational Highlights

Otakikpo

·      Production levels averaged approximately gross 5,305 bopd (2,122 bopd net to LEKOIL Nigeria)

·      Updated Competent Person’s Reports announcing a significant upgrade to 2P oil reserves estimates and prospective resources (unrisked) for LEKOIL Nigeria’s working interest in the field

·      Field Licence renewed

·      Phase Two plans underway, subject to the securing of funding, for a five to seven well drilling programme, targeting the increase of production to around gross 15,000 to 20,000 bopd (6,000 – 8,000 bopd net to LEKOIL Nigeria)

OPL 310

·      Advanced plans for the Ogo appraisal drilling programme with well locations selected. Funding discussions currently underway with industry partners

·      LEKOIL executed a legally binding Cost and Revenue Sharing Agreement (“CRSA”) to progress the appraisal and development programme activities at the OGO discovery and conversion to an Oil Mining Licence (“OML”)

·      OPL 310 Licence extended to 2 August 2022, following the payment of an extension fee by LEKOIL

OPL 276

·      Acquired 45% participating interest in the Production Sharing Contract in relation to the Oil Prospecting Licence 276 from Newcross Petroleum Limited (subject to receipt of required consents)

·      Preliminary resource estimates by Newcross, based on four wells resulting in four discoveries, reported gross recoverable volumes of 29 million barrels of oil and 333 Bcf of gas, upside of 33 million barrels of oil and 476 Bcf of gas (recoverable)

OPL 325

·      Execution of the PSC in relation to the Oil Prospecting Licence 325 expected to occur in 2020

·      On executing the PSC, LEKOIL intends to farm-down a portion of interest following a detailed prospect and lead risking study.

Lekan Akinyanmi, LEKOIL’s CEO, commented, “The priority for 2020 is to advance towards the start of the drilling programmes at both Otakikpo and Ogo in OPL 310. The next two years will prove to be transformative and provide key catalysts for value appreciation for shareholders through the drill bit as we advance in building a leading Africa-focused exploration and production business.”

:2019 was a pivotal year for LEKOIL in terms of achieving some of our critical targets and setting the tone for the transformation we expect to see in 2020. We achieved full alignment with the Nigerian Government and our joint venture partners and saw the resolution of the regulatory delays on OPL 310.”