Africa Oil Corp. announce the completion of the amalgamation to consolidate all of the Prime Oil & Gas Coöperatief U.A (“Prime”) shareholding in Africa Oil, and declares the first quarterly cash dividend of USD 25 million, as it implements its new enlarged base dividend policy, with a target annual distribution of at least USD 100 million. The Company also announces Board and Executive Management changes, and presents its full-year 2025 Management Guidance.

Africa Oil President and CEO, Roger Tucker commented: 
“This is a transformational milestone that marks the next stage of value creation and shareholder returns for Africa Oil as an enlarged company. There is compelling strategic rationale for the consolidation and we believe that the quality and materiality of the assets within our diversified portfolio, our newly combined balance sheet, the strength of the cash flow profile and an attractive double-digit dividend yield all help emphasise a superior investment proposition for investors. In that regard, I am pleased to announce that the Company’s new Board has approved the declaration of the first quarterly dividend as we seek to set a new high mark for shareholder returns.

I welcome our new Directors and thank our outgoing Directors for their support over the past year as we delivered several strategic transactions to simplify and strengthen the Company’s fundamental business proposition. I would like to thank Pascal Nicodeme, our outgoing CFO, for his steadfast service to the Company and the Board is pleased to retain his unique insights and expertise as a new Board member. I would also like to welcome Aldo Perracini, our new CFO, and I am delighted to have the benefit of his years of experience at Prime.  We look forward to leveraging our strong position to deliver long-term value for all our stakeholders.”

Africa Oil Chairman, Huw Jenkins commented: 
“On behalf of the Board I congratulate the teams at Africa Oil, Prime and BTG Pactual in closing this deal considerably ahead of the original timeline. The enlarged Africa Oil is uniquely well-positioned to drive long-term value through its existing portfolio of world-class assets as well as by leveraging its strong balance sheet to consider strategically complementary acquisitions in our target markets.  The Company has ambitious growth targets and the vision is to continue growing into a leading full-cycle E&P, establishing it as a trusted and prominent industry partner. The management team has done an excellent job of preparing the Company for its next phase of growth and this completion effectively transforms the Company into one of considerably greater scale that is better placed to realise its vision.”

Highlights

• Transformational deal which doubles reserves and production in high quality offshore assets that benefit from low lifting costs, premium Brent pricing and a favourable fiscal regime.
• Consolidating full control of Prime’s cash flows and balance sheet with an enlarged cash position  of USD 460.9 million as at December 31, 2024.
• Anticipated substantial increase in free cash flows per share are expected to significantly enhance the Company’s capacity to support:
  • sustainable through-cycle returns to shareholders, underpinning an annual base dividend of USD 100 million (“Base Dividend”) that is deemed by the Board to be sustainable in a range of through-cycle oil price scenarios; and
  • an annual commitment to distribute at least 50 per cent. excess free cash flow after the Base Dividend distribution in the form of supplemental dividends and/or share buybacks.
• Increased scale and balance sheet strength present the Company with considerable scope to optimise its capital structure and to pursue its organic and inorganic growth opportunities.
• Issued 239,828,655 newly issued common shares in Africa Oil to BTG Pactual Oil & Gas S.a.r.l. (“BTG O&G”) representing approximately 35.5% of the outstanding share capital of the Company.
• The introduction of BTG O&G as a shareholder that is strategically aligned with the Company and committed to growing a sustainable upstream oil and gas business, to deliver superior value creation and shareholder capital returns.
• BTG O&G enhances Africa Oil’s access to business opportunities while supporting disciplined capital allocation through its Board participation.
• Changes to the Board and Executive Management:
  • Keith Hill, Erin Johnston, Andrew Bartlett and Gary Guidry have stepped down from the Board;
  • Roger Tucker (President and CEO), John Craig, Michael Ebsary and Kimberley Wood remain on the Board and are joined by Huw Jenkins (new non-executive Chair), Pascal Nicodeme, Edwyn Neves, Ahonsi Unuigbe and Richard Norris; and
  • Pascal Nicodeme has ceased to be the Chief Financial Officer of the Company and Aldo Perracini has joined the Company as the new Chief Financial Officer, pursuant to BTG O&G’s nomination rights under its Investor Rights Agreement with the Company (“Investor Rights Agreement”).
• Consolidated full-year 2025 Management Guidance incorporating:
  • working interest1 (“W.I.”) production guidance range of 28.0 – 33.0 thousand barrels of oil equivalent per day (“kboepd”) and entitlement2 production guidance range of 32.0 – 37.0 kboepd;
  • EBITDAX3 of USD 500 – 600 million;
  • cash flow from operations before working capital adjustments and interest payments3 guidance range of USD 320 – 370 million; and
  • capital investment of USD 150 – 190 million.
• The Company plans to announce a new brand that will be launched with its First Quarter 2025 results scheduled for May 14, 2025, to project its focus on a total shareholder returns business model and a broader geographical mandate.

Dividend Declaration

The Company announces that its Board has declared the distribution of the Company’s first quarterly cash dividend of USD 25 million or approximately USD 0.0371 per common share. This dividend will be payable on April 11, 2025, to shareholders of record at the close of business on March 27, 2025. This dividend qualifies as an ‘eligible dividend’ for Canadian income tax purposes. 

Dividends for shares traded on the Toronto Stock Exchange (“TSX”) will be paid in Canadian dollars on April 11, 2025; however, all US and foreign shareholders will receive USD funds. Dividends for shares traded on Nasdaq Stockholm will be paid in Swedish Krona in accordance with Euroclear principles on April 16, 2025.

To execute the payment of the dividend, a temporary administrative cross border transfer closure will be applied by Euroclear from March 25, 2025, up to and including March 27, 2025, during which period shares of the Company cannot be transferred between the TSX and Nasdaq Stockholm. 

Payment to shareholders who are not residents of Canada will be net of any Canadian withholding taxes that may be applicable.

Board and Executive Management Changes

The Company’s new Board is comprised of nine directors:

• the President and Chief Executive Officer of Africa Oil – Roger Tucker (non-independent);
• three directors nominated by Africa Oil – Michael Ebsary (independent), Kimberley Wood (independent) and Pascal Nicodeme (non-independent);
• three directors nominated by BTG O&G - Huw Jenkins (independent), Edwyn Neves (independent) and Ahonsi Unuigbe (independent); and
• two additional independent non-executive directors nominated by Africa Oil and approved by BTG O&G – John Craig (independent) and Richard Norris (independent).

Keith Hill, Erin Johnston, Andrew Bartlett and Gary Guidry have stepped down from the Board.

Pascal Nicodeme has ceased to be the Chief Financial Officer of the Company and Aldo Perracini has joined the Company as the new Chief Financial Officer.

Africa Oil’s Deepwater Nigerian Assets

With the completion of the Amalgamation, Africa Oil’s main assets are an 8% W.I. in Petroleum Mining Lease (“PML”) 52 and Petroleum Prospecting License (“PPL”) 2003, and a 16% W.I. in PMLs 2, 3 and 4 as well as PPL 261. PML 52 and PPL 2003 are operated by an affiliate of Chevron Corporation with PML 52 covering part of the producing Agbami field. PMLs 2, 3 and 4 and PPL 261 are operated by affiliates of TotalEnergies S.E. and contain the producing Akpo and Egina fields as well as the Preowei and Egina South Discoveries. Africa Oil’s assets are located over 100 km offshore Nigeria.

All three producing fields have high quality reservoirs and produce light to medium sweet crude oil through FPSO facilities. Akpo and Egina also export associated gas which feeds into the Nigerian liquified natural gas plant, whilst Agbami associated gas is mostly reinjected.

Africa Oil’s year-end 2024 pro forma Proved plus Probable (“2P”) reserves4, based on 100% shareholding in Prime, was estimated to be 70.8 million barrels of oil equivalent (“MMboe”) on the W.I. basis, and 101.6 MMboe on the net entitlement5 basis with an after-tax 2P NPV(10) of USD 2,128 million.

Full-Year 2025 Management Guidance

The Company’s full-year 2025 production will be generated solely by its deepwater Nigerian assets. The 2025 Management Guidance includes W.I. production guidance range of 28.0 – 33.0 kboepd and entitlement production range of 32.0 – 37.0 kboepd with approximately 75% expected to be light and medium crude oil and 25% conventional natural gas.

Africa Oil is expected to sell 11 - 13 cargoes of approximately one million barrels each during 2025 and to generate USD 500 – 600 million in EBITDAX and USD 320 – 370 million in cash flow from operations before working capital adjustments and interest payments. These estimates are based on a 2025 average Brent price of USD 75.0/bbl. At an average Brent price of USD 85/bbl the mid-point of the cash flow from operations guidance range is estimated to increase by approximately 19%, and at an average of USD 65/bbl the mid-point is estimated to decrease by approximately 12%.

Africa Oil’s 2025 capital investment is expected to be in the range of USD 150 – 190 million with most of the expenditure to be incurred on the Company’s Nigerian assets including infill drilling program on Egina and Akpo oil fields. 

KeyFacts Energy: Africa Oil Nigeria country profile