What we do
The Group historically focused on exploration and appraisal opportunities only. The Group is committed to playing a leading role in securing Africa’s energy needs to meet the growing demand expected on the continent over the next decades.
The Group has therefore expanded its focus to include development and production activities, energy infrastructure and selected downstream opportunities that will meet the demand for products to support the proliferating needs of the continent. The oil and gas sector is expected to play a significant role in meeting the energy needs of Africa.
The Group is committed to investing in the potential of Africa’s indigenous assets and presents an excellent investment vehicle for both private and institutional investors whose interests are aligned with the Group’s vision and mission.
Overview of the upstream process
The international best practice of a staged development process applicable to oil and gas exploration and development is endorsed and applied by the Group. At the end of each stage in the process, the Board is required to assess the viability of the asset and whether there is significant economic benefit to the Group to justify continuing to the next stage of the project.
In the event that the size and quality of the hydrocarbons at any stage are not adequate to be commercially viable, then the installed facilities will be decommissioned and the wells abandoned.
Prior to any activities commencing on a project the Group will firstly be required to secure an exploration licence from the government or regulatory body to commence exploration activities. The licence conditions will include a workplan as agreed with government for the exploration phase.
During this stage of the upstream activities the aim is to discover commercial hydrocarbons in prospective subsurface structures in order to demonstrate the viability of the asset.
Exploration activities include:
- acquiring seismic and other geophysical data to image the subsurface;
- developing and understanding the subsurface geology;
- using this understanding to predict where oil and gas might be trapped; and
- identifying targets for exploration and then drilling one or more exploration wells to determine the presence of hydrocarbons.
Exploration tools used:
- Satellite, gravity-magnetic and seismic data acquisition
- Processing and interpretation
- Geological evaluation and modelling
- Well data evaluation, including petrophysics and core studies
- Expert knowledge and integration
Appraisal and development
Following the decision by a company to progress to the appraisal stage, the post-exploration processing, analysis and interpretation will be undertaken and applied in static and dynamic models. One or more appraisal wells might be required to firm up the discovery of hydrocarbons.
During this stage, the production and facility plans will be prepared before starting the development stage of the field development.
Pre-production development activities include drilling development wells, constructing facilities, and commissioning and preparing for production.
Typical processes during the appraisal and development stage are outlined below:
- once a discovery is made the field size is defined;
- the reservoir is characterised to optimise the development plan;
- a plan of how to best get oil and gas out of the reservoir is defined; and
- a field development plan is prepared for approval.
The development plan will be subject to government approval. During this process a company will assess the impact of the development plans on the environment and communities to ensure a sustainable development plan.
The production phase is when the field development has been completed and the “first oil” is produced from the field. The operator of the field will assess various production technologies and processes to recover the oil and gas that could optimise the recovery rates from the field and thereby increase production. This includes enhanced methods to recover the hydrocarbons.
Decommissioning and abandonment
Decommissioning of the field to its natural state is the final process in the life of a field and marks the end of commercial production. The site restoration is intended to remove the wells and installed facilities safely and economically in order to comply with local laws, international conventions and Group policy. This ensures that there is no harm to the environment after the production phase.
Cash flow profile for upstream developments
Upstream project development is a costly process required to produce hydrocarbons to meet the world’s energy demands.
The cash flows during the exploration phase are significant and increase exponentially when the appraisal and development phases are undertaken on a project. The process to achieve production and thereby generate revenue on a project can take over 10 years. In order to go into production there needs to be commercially viable quantities and production volumes of hydrocarbons from the field to generate a sufficient return from a project.
Upstream developments can take place either onshore or offshore; however, offshore fields tend to be more costly due to the drilling rigs and facilities that will be required to exploit the hydrocarbons. International oil majors have in more recent times focused on offshore fields, where the improvements in technology have made it easier to exploit these vast resources.
The mapping of our portfolio of assets on the project stage life cycle is shown in the African Footprint section. Due to the long time period required to advance to production, the Group in terms of its new strategy, is focused on fast tracking its portfolio to secure low-cost, near-term production assets or producing assets. This will enhance the Group’s ability to generate revenue that could be used to develop existing and new exploration and appraisal assets.