M&P working interest production in Q1 2021: 25,240 boepd

• M&P working interest production of 15,120 bopd on the Ezanga permit in Gabon relatively unchanged from T4 2020, due to the continuation of production cuts related to OPEC quotas
• Significant increase in gas production in Tanzania, with output of 40.7 mmcfd for M&P’s working interest
• M&P working interest production of 3,333 bopd in Angola, down sharply due to a planned shutdown for maintenance

Valued production higher for the quarter at $96 million, thanks to the continued rise in crude oil prices

• Average sale price of oil $57.3/bbl, up 28% from Q4 2020 ($45.0/bbl)
• Sales of $85 million after taking into account an $11 million of restatement for lifting imbalances and inventory revaluation (including 13 M$ worth of barrels produced but not sold during the period)

Solid financial position and preparations for the resumption of development

• Cash position of $154 million at 31 March 2021
• Preparations ongoing to restart development drilling on the Ezanga licence in summer 2021, which will help restore the production potential of the fields

M&P’s working interest production in Q1 2021 stood at 25,240 boepd, a 1% increase over Q4 2020 (24,937 boepd). While there was virtually no change in activity on the Ezanga permit in Gabon (15,120 bopd for M&P working interest) as a result of the continuation of the implementation of OPEC quotas, the marked rise in gas production in Tanzania of 11% (40.7 mmcfd for M&P working interest) offset the 11% decline in production in Angola following a maintenance shutdown in February.

The average sale price of oil was $57.3/bbl, versus $45.0/bbl in the previous quarter, an increase of 28%.

Group valued production (revenue from production activities, excluding lifting imbalances) stood at $96 million in Q1 2021, up 15% from Q4 2020. The restatement for lifting imbalances ($13 million produced but not lifted during the period), net of inventory revaluation (positive impact of $2 million), resulted in a negative impact of $11 million in the first quarter. This took Group consolidated sales in Q1 2021 to $85 million.

Production activities

Gabon
M&P’s working interest oil production (80%) on the Ezanga permit was 15,120 bopd (gross production: 18,901 bopd) in Q1 2021, more or less unchanged from Q4 2020 (15,096 bopd for M&P working interest). Production from the field was limited to 19,000 bopd (or 15,200 bopd net to M&P’s working interest) due to production cuts imposed under OPEC quotas.

With the lifting of this constraint in sight, M&P is preparing for the development drilling campaign scheduled to begin in the summer, which will help restore the production potential of the fields.

Tanzania
M&P’s working interest gas production (48.06%) on the Mnazi Bay permit stood at 40.7 mmcfd (gross production: 84.7 mmcfd) in Q1 2021, up 11% from Q4 2020. This increase was all the more noteworthy given that gas demand during the first quarter is usually low because of the rainy season, which increases the availability of hydropower generation; the change from Q1 2020 was therefore 33%.

A change in the accounting methodology is the reason for the comparative sequential decline in sales from Q4 2020, despite the increase in production. This change has no impact on operating income. 

Angola
M&P’s working interest production (20%) in Block 3/05 in 2020 was 3,333 bopd (gross production: 16,663 bopd). Production was halted or significantly reduced for 10 days at the end of February for longplanned maintenance. Production was also affected in March by the moving in of a snubbing unit.

The operator Sonangol P&P, with the active support of M&P and the other partners, continues to work on the to ramp up of water injection, which would help increase production. An incremental rise in production is also expected from the workover campaign which is starting now.

Financial position
M&P’s cash position at 31 March 2021 was $154 million, down slightly from December 2020 ($168 million) due to only one lifting recorded during the period. M&P also repaid $22 million in debt in Q1 2021, reducing its total debt to $601 million. Net debt stood at $447 million at end-March 2021.

At the end of 2020, M&P had initiated a procedure to obtain the prompt release of $43 million held on an escrow account and corresponding to the amount owed by Gabon Oil Company (GOC) in respect of pre2018 carried costs. The ruling by the Paris Judicial Court on 29 March 2021 did not authorise the release of the funds, as requested by M&P. While it did not rule on the merits of the case, and in particular it did not challenge the approval of the whole amount of $43 million by the ICC expert proceedings, the court deemed that the arbitration proceedings requested by GOC should be completed before the escrow account could be released. M&P remains confident on the positive outcome of this additional step, which could take between 12 and 18 months.

KeyFacts Energy: Maural & Prom country profiles: Angola   l   Gabon   l   Tanzania

* Premium profile information includes; description, overview of assets, current and planned operational activity, capex, local and corporate locations, news archive, farm-in opportunities and 'one-click' access to company 'Linkedin People'. Contact KeyFacts Energy to discover how you can secure access to over 2,600 'country-specific' company profiles from 144 countries.