Anglo African Oil & Gas PLC Resumption of Drilling and Compensation (4100I)
26 November 2018 - 6:00PM
UK Regulatory
TIDMAAOG
RNS Number : 4100I
Anglo African Oil & Gas PLC
26 November 2018
Anglo African Oil & Gas PLC / Index: AIM / Epic: AAOG /
Sector: Oil & Gas
ANGLO AFRICAN OIL & GAS PLC ('AAOG' or the 'Company')
26 November 2018
Resumption of Drilling
Compensation from the Drilling Contractor
Resumption of drilling
Anglo African Oil & Gas plc, an independent oil and gas
developer, is pleased to announce that drilling operations have now
recommenced on well TLP-103C ('TLP-103C' or 'the Well') at its
Tilapia site in the Republic of the Congo.
Following an unscheduled rig inspection by AAOG staff on site
where an issue was detected on the elmagco brake system, drilling
was suspended to allow for the rig company (SMP) to remove these
parts and for them to be repaired. These parts had met testing
requirements during the pre-spud third-party rig inspection but
performance had subsequently diminished. The parts in question have
now been repaired and reconditioned in Paris by the drilling
contractor and reinstalled to the rig.
The Company confirms that suspension occurred before
intersection of any of the target horizons being the R1/R2, Mengo
and Djeno. Had the parts failed further into the drilling programme
then the effect could have been materially adverse.
Drilling recommenced at a depth of 660 metres, and AAOG expects
to reach TD toward the end of December. The Company will provide
periodic updates as it receives results from the target horizons in
line with Congolese regulations.
Compensation from the Drilling Contractor
The drilling contractor, SMP, have accepted that this delay is
entirely their fault and have agreed that, in addition to the rig
being on zero rate during the delay, they will compensate AAOG for
a substantial amount of AAOG's additional costs which have been
incurred with respect to this delay. The mechanism for this
compensation is through a significantly reduced day rate for the
rig going forward.
David Sefton, Executive Chairman, commented: "This delay has
been extremely frustrating not only for the Company but, more
importantly, for its shareholders. However, it was clearly the
right decision for AAOG to insist on a suspension of drilling
pending these repairs rather than risk a serious incident should
those parts have failed when intersecting a target horizon. We have
had open and frank discussions with SMP and we are assured by them
that we should not expect any further issues with the rig and look
forward to announcing our results in due course."
**ENDS**
Market Abuse Regulation (MAR)
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
For further information please visit www.aaog.co or contact:
Anglo African Oil & Gas plc Tel: c/o St Brides
Partners +44 20
7236 1177
David Sefton, Executive Chairman
James Berwick, Chief Executive Officer
finnCap Ltd (Nominated Adviser and Broker) Tel: +44 20 7220
0500
Christopher Raggett, Giles Rolls, Anthony Adams
(Corporate Finance)
Camille Gochez (Corporate Broking)
St Brides Partners (Financial PR) Tel: +44 20 7236
1177
Frank Buhagiar, Juliet Earl
Notes to Editors
Anglo African Oil & Gas (AAOG) is an AIM-listed independent
oil and gas company that owns a 56% stake in the producing Tilapia
oil field in the Republic of the Congo. The Company boasts a
low-cost production story in a prolific hydrocarbon region with
significant exploration upside, differentiating it substantially
from its E&P peers. Additionally, management's remuneration is
tied to hitting production milestones, reflecting their strong
focus on cost control.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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