Africa Oil intends to conduct a major share buyback within a year
In January 2024, Africa Oil conducted a share buyback of 522 thousand shares. This operation is part of the company’s previous strategy of returning securities.
The Canadian oil and gas company had previously made an offer to its issuers. As a result, the company repurchased 192 thousand common shares on the Toronto Stock Exchange (TSX). Scotia Capital Bank acted as an agent for the company. It is authorised to trade in various financial instruments of the oil and gas producer.
Reportedly, 330,000 shares were bought back by Pareto Securities on the trading floor of Nasdaq Stockholm. Africa Oil states that the repurchased shares will be in the cancellation process.
The share buyback programme lasts 1 year – from December 2023 to December 2024. During this period, the issuer has the right to repurchase approximately 38.7 million ordinary shares.
Overview of Africa Oil
Africa Oil Corp was founded in 1993 as Canmex Minerals. Following a rebranding exercise in 2007, the company adopted its current name. The company operates mining and resource development in Nigeria. It also has interests in Africa and Guyana’s southern and western regions.
Until 2023, Africa Oil was also active in Kenya at the South Lokichar oil project. It partnered with TotalEnergies and Tullow Oil to develop the project. In 2022, however, French producer TotalEnergies announced its intention to withdraw from the joint venture. This was due to a lack of support from the Kenyan government. Africa Oil also withdrew from the project. According to company officials, the reason for the decision was to focus on more promising business areas. The first of these is the development of oil reserves in Namibia.
In early 2024, it became known that Africa Oil intended to start work at a new site. This is the Orange Basin, located on the shelf in southern Africa. The block is close to the oil fields where TotalEnergies and Shell are producing.
The contract for the rights to develop Orange Basin was signed in the summer of 2023. At the time, the Canadian producer said it had acquired an additional 6.3% in the new block. The company wanted to increase its working interest. In total, three companies have the right to develop the area:
– Africa Oil, which owns about 26.3% of the company;
– Eco manages 20%;
– Ricocure is the largest resource developer with a 53.8% interest.
The partners are negotiating with several other companies to transfer stakes. At the same time, a drilling project will be under development. The producers focus on minimising the negative environmental impact of mining.
