Africa Oil Announces 102% 2P Reserves Replacement Ratio

Wednesday, March 2, 2022

Africa Oil Corp. announced the posting of its 2021 statement of reserves on SEDAR (www.sedar.com) as part of its Annual Information Form. This disclosure is based on an independent reserves evaluation, effective December 31, 2021, prepared by RISC (UK) Limited for Africa Oil in accordance with Canadian National Instrument 51-101 – Standards for Oil and Gas Activities and the Canadian Oil and Gas Evaluation Handbook. Africa Oil’s statement of reserves is based on the Company’s 50% ownership interest in Prime Oil & Gas Coöperatief U.A (“Prime”).

Highlights

• YE’21 working interest (W.I.) and net entitlement2 Proved (“1P”) reserves of 48.6 MMboe (YE’20: 45.5 MMboe) and 55.0 MMboe (YE’20: 54.5 MMboe), respectively.
• YE’21 (W.I.) and net entitlement Proved plus Probable reserves (“2P”) of 72.8 MMboe (YE’20: 72.6 MMboe) and 82.1 MMboe (YE’20: 85.8 MMboe), respectively.
• I. 2P reserves replacement ratio of 102% (YE’20: of 114%) is the result of strong reservoir performances with positive technical revisions, improvements in the oil price forecast and resource transfers of 4.1 MMboe from 2C to 2P, compared with a production of 10.0 MMboe net to the Company’s 50% shareholding.
• After-tax 1P NPV (10) valuation $996 million (YE’20: $1,004 million) and 2P NPV (10) valuation of $1,444 million (YE’20: $1,356 million)3.

Africa Oil President and CEO, Keith Hill, commented on the statement of reserves: “I am pleased to report another strong year of operational performance by Prime’s fields. We have yet again achieved a positive reserves replacement ratio, reiterating the quality of these reservoirs. There are number of compelling opportunities in Prime’s portfolio to extend the runway of value creation. These include low risk and high IRR infill drilling and satellite field tie-back opportunities, that benefit from the high-quality infrastructure already in place. These investment opportunities are supported by the positive outcome of Nigeria’s Petroleum Industry Act. There is now a strong case for early extension and conversion of Prime’s licenses to these new supportive fiscal terms. Once achieved, this would allow Prime to refinance its RBL debt facility and materially increase its near-term dividend payments to Africa Oil.”

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