Investing.com - Financial Markets Worldwide

Nigeria's Lekoil seeks $100 mln for Ogo oilfield drilling

Published 28/08/2020, 15:33
Nigeria's Lekoil seeks $100 mln for Ogo oilfield drilling
LEK
-

LAGOS, Aug 28 (Reuters) - Nigerian energy company Lekoil Ltd
LEK.L needs to raise around $100 million before it can start
drilling in its Ogo oilfield, its chief executive told Reuters.
Lekoil reached a deferred payment deal earlier this year to
keep its stake in OML 310, where Ogo sits, after it discovered a
$184 million loan it wanted to use for the purchase was
fraudulent. Chief Executive Lekan Akinyanmi said the company was able to
finance much of the Ogo preparation work with cash from its
producing field, Otakikpo, and will drill once it raises the
money. Lekoil is in talks for a mix of direct investment into the
asset and vendor financing, which Akinyanmi said is the most
cost-effective way to raise money for drilling. He expects to
spend $1 billion developing Ogo through its life cycle.
"We want Ogo to raise its own capital so that we can
actually start to build cash...and maybe in a few years start to
pay dividends," he said, adding that Otakikpo, which produced an
average of 5,305 barrels per day (bpd) last year, yielded
$15-$16 million in free cash.
Shares in London-listed Lekoil plunged in January after it
revealed the loan that it thought was from the Qatar Investment
Authority (QIA) was a "complex facade".
Shares traded at 2.46 pence on Friday, compared with as much
as 11.14 pence in January before the loan fraud was revealed.
In results published this week, Lekoil posted a $12 million
loss in 2019, compared with a $7.8 million loss in 2018. Its
cash balances dropped to $2.7 million from $10.4 million.
Lekoil is also targeting a 40% reduction in annual general
and administrative expenses due to this year's oil price crash.


Latest comments

Install Our App
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.