Cameroon Producer Gains On Higher Gas Sales
London-listed Victoria Oil & Gas has seen its financial position improve dramatically in the six months ending June 30, after restoring gas supplies to a gas-fired power plant in Cameroon.
Sales to Cameroon’s 30-MW Logbaba gas-fired power plant were resumed in December 2018, Victoria said in a stock exchange filling on September 30, under a three-year contract with the station's operator, national power utility Eneo. As a result, gross gas sales from the company’s Logbaba field reached 1.785bn ft3 in January through June, up from 650mn ft3 in the same period last year.
Sales to Victoria’s thermal gas and industrial power customers were both up at 731mn and 50mn ft3 in the six months, compared with 619mn and 31mn ft3 respectively a year earlier. But the company also gained from the supply of more than 1bn ft3 for grid power generation, versus nothing in the first half of 2018.
Revenues came to $10.68mn, more than double the $5.01mn figure a year earlier. Daily output also soared by 190% to 9.9mn ft3, thanks to the resumption of supplies to Eneo as well as Victoria gaining some new independent customers. Moving forward, the company in late July also struck a preliminary deal to supply 25mn ft3/day to Turkey’s Aksa Energy to fuel a planned 150-MW power station in Douala.
“Signing of the term sheet with Aksa Energy is very positive and bringing that to fruition alongside additional increasing production with thermal customers will be the focus over the coming twelve months,” Roger Kennedy, who took on the role of Victoria’s chairman in April, said in a statement.
Despite good news on the sales front, Victoria still incurred an operating loss of $6.8mn, after booking a $4.92mn charge for depreciation and a $5.56mn impairment on an investment. It also spent $6.7mn on administration costs, versus $3.16mn a year earlier. Ebitda nevertheless reached $3.68mn, from just $27,000 a year earlier, while gross profits from continuing operations came to $5.88mn, compared with $976,000. Cash and equivalents totalled $14.38mn at the end of June.