(Alliance News) - Afentra PLC on Wednesday said its wholly-owned subsidiary Afentra (Angola) Ltd signed a deal with Azule Energy Angola Production B.V. to buy stakes in Block 3/05 and Block 3/05A offshore Angola.

The Africa-focused energy company said its Angolan subsidiary will purchase a 12% and a 16% interest in the Azule blocks, respectively.

The consideration is USD48.5 million and the deferred contingent payments are worth up to USD36 million, dependent on the price of oil, production and development conditions, Afentra said.

The company added it has agreed with Angolan oil and gas company Sonangol Pesquisa e Produção SA to amend the terms of its share purchase agreement of April last year to reduce the interest being acquired by Afentra in Block 3/05 from 20% to 14%. This means contingent considerations will be reduced to USD56 million and USD35 million.

This announcement comes as Afentra shares were temporarily suspended from trading on AIM on Thursday morning, pending the acquisition of the blocks.

Chief Executive Officer Paul McDade said: "We are delighted to have agreed terms with Azule and signed the SPA increasing Afentra's interest in the high-quality producing Block 3/05 and a material increase in our Block 3/05A interest, offering access to existing discovered resources.

"This highly accretive transaction further demonstrates the company's commercial discipline and focus on robust cash flow, increasing our net production to 6,000 barrels of crude oil per day and bbl/d and 2P reserves to 32 million barrels respectively."

By Sabrina Penty, Alliance News reporter

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