Savannah Energy said its production from production fields in Africa improved drastically as it issued a financial and operational update for Q1 2023.
The company reported total revenues for Q1 2023 of US$147.6m, up 26 per cent year-on-year, comprising US$71m from Nigerian operations (up 29 per cent year-on-year) and Chad upstream revenues of US$76.6m.
Savannah’s cash balance stood at US$217.3m with net debt of US$412.2m.
It reported average gross daily production of 54.9,000 barrels of oil equivalent per day Kboepd in Q1 2023, compared to 21.6 Kboepd in Q1 2022.
Excluding Chad production, Q1 2023 average gross daily production LFL was 25.9 Kboepd, a 20 per cent increase compared to Q1 2022.
Of the total 54.9 Kboepd, 43 per cent was gas, including a 22 per cent increase in production from the Uquo gas field in Nigeria compared to Q1 2022 (from 19.4 Kboepd to 23.7 Kboepd).
In Nigeria, Savannah sold gas to 7 customers in Q1 2023, including Calabar Electricity Generation, Lafarge Africa, Ibom Power, First Independent Power, Central Horizon Gas, TransAfam Power, and Notore Chemical Industries.
In order to keep up with demand, Savannah is advancing the US$45m compression project at the Uquo CPF. Design work commenced in Q1 2023 and is scheduled for completion in Q4 2023.
Savannah’s aggressive expansion is beginning to bear fruit, with oil and renewable energy projects in Niger rapidly advancing, and COTCo in Cameroon delivering a steady cash flow. The acquisition of Petronas in South Sudan is also advancing at a rapid pace, and a new series of utility-scale renewable projects are planned for Q2 and Q3 2023.
In Cameroon, Savannah acquired a 41% indirect interest in COTCo from ExxonMobil on 9 December 2022. COTCo owns and operates the 903km Cameroon oil export pipeline and the Kome Kribi 1 FSO unit. In Q1 2023, COTCo transported on average 128.8 Kbopd of crude oil with a total of 11 liftings conducted.
In Niger, Savannah advanced plans for the Early Production Scheme on the approx. 35 MMstb of Gross 2C Resources R3 East oil development. A well test programme is expected in Q4 2023 after which Savannah expects to issue a comprehensive field development plan with first oil targeted for 2024.
In Chad, the government nationalised Savannah Chad’s upstream production assets and Savannah’s 40 per cent interest in Tchad Oil Transportation Company (TOTCo). The nationalisations will not affect Savannah’s aforementioned 41 per cent indirect equity interest in COTCo. Savannah condemned the actions of the Chadian government and said it has raised the issue with the Paris-based ICC arbitral tribunal, seeking full recompense for the loss it will suffer as a result of the nationalisations.
In South Sudan, Savannah continues to advance its reverse takeover of Petronas International’s entire oil and gas business in the country. An AIM admission document is expected in H1 2023.
Overall, Savannah’s business is growing in all four countries where it currently operates. The growth trend of the past 4 years is expected to continue in 2023, especially as the company’s renewable portfolio begins to add value.
Andrew Knott, CEO of Savannah Energy, said, “This morning’s update clearly demonstrates the strength and potential of our business and the positive impact we are making in our host countries: we are reporting like-for-like(1) organic Total Revenues(2) growth of 26% year-on-year (with like-for-like(1) Total Revenues(2) having now doubled since 2017); our oil and renewable energy projects in Niger are now advancing at a rapid pace; and COTCo in Cameroon continues to deliver a strong consistent financial performance. On the new ventures front, we continue to progress our planned acquisition of PETRONAS’ assets in South Sudan and expect to announce a series of new utility-scale renewable power projects over the course of Q2 and Q3 2023.
At this time, I would like to express our gratitude to those who have contributed to these successes – my incredibly dedicated and passionate colleagues, our host governments, communities, local authorities and regulators, our shareholders and lenders, and our customers, suppliers and partners. Thank you all.’