“San Leon is in a strong position, currently sitting with US$36.5 million in cash on our balance sheet. The current environment generates challenges which Eroton is addressing well, but at the same time it provides a huge opportunity for our Company to initiate its next stage of growth. We have the cash resources, technical and managerial capability, and established relations to select our next projects.
Oisin Fanning, CEO, commented:
“OML 18 remains a world class asset and the activities being undertaken by our partners are expected to significantly reduce downtime and losses going forward, benefiting our initial indirect interest of 10.58% in OML 18.
“Our robust financial position, additional significant funds expected to be received in the in the next 18 months, existing and anticipated new projects, are planned to continue to provide continued shareholder returns. We are proud to have distributed US$66.0 million to shareholders in the past 15 months.
“San Leon is very well placed to continue to deliver its strategy in the year ahead and the Board looks forward to updating shareholders on the Company’s progress.”
San Leon, the independent oil and gas production, development and exploration company focussed on Nigeria, is pleased to announce its audited final results for the year ended 31 December 2019. The full annual report for the year to 31 December 2019 is available on the Company’s web site and will be posted to shareholders shortly.
• Returned approximately US$66.0 million to shareholders during the year and post year end delivering on the company’s commitment to shareholder returns:
– Tender oﬀer completed in early 2019, repurchasing US$30.5 million of Company shares
– A share repurchase of US$2.0 million of Company shares was also completed between October 2019 and January 2020
– A special dividend of US$33.0 million was declared in May 2020, giving a dividend yield of approximately 30% as at the date of dividend announcement
• Appointed Lisa Mitchell as Chief Financial Officer and Executive Director
• Completed the sale of interests in four Polish concessions to Horizon Petroleum Ltd as part of the Company’s strategy to dispose of non-core assets
OML 18 Operational
• Eroton Exploration and Production Limited (“Eroton”) (the operator of OML 18) received a 20-year lease renewal for OML 18. The lease will now expire in 2039
• Full-field gross oil production before allocated losses was around 39,000 bopd. Removing the effect of field downtime, gross production during uptime was approximately 50,000 bopd (2018: 45,000 bopd)
• Two new wells drilled and completed with the third started (completed in April 2020). 14 workovers were performed during the year (cement packer reservoir zone changes, gas lift installations and retrofits, perforations and hot oil treatments)
• Oil sales averaged approximately 29,500 bopd (2018: 30,000 bopd) after overall downtime of 24% (largely associated with NCTL export pipeline downtime) and pipeline losses of 22% (2018: 12% downtime, 26% pipeline losses)
• Signiﬁcant progress on planning new oil export pipeline and oﬀshore storage facility, targeting reduced export downtime and losses – on track to be completed in the coming quarters
• US$43.2 million received in cash from loan notes mechanism in OML 18 in 2019, further strengthening San Leon’s ﬁnancial position and outlook, also enabling the Company to start to deliver its shareholder return commitment – to date the Company has received just over US$190 million in total loan notes payments
• A further US$41.5 million received to date in 2020, with an expected US$10 million to come in Q4
• A further US$103.9 million (approximately) expected in interest and loan note repayments by end 2021
• In January 2019 , the Company reported the restructuring of the Reserves Based Lending (“RBL”) facility held by Eroton which frees up near‐term cash resources for operations
• Cash balance of US$36.5 million as at 19 June 2020
• Loss for the financial year of US$38.6 million predominantly associated with non-cash items such as Impairment of non-core assets (Barryroe).