Savannah Energy's South Sudan acquisition terminated, company seeks alternative deal
() , an Africa-focused oil and gas company, issued an update on its proposed acquisition of PETRONAS International's energy business in South Sudan.
On December 12, 2022, Savannah announced the sale and purchase agreement with PETRONAS for its entire oil and gas business in South Sudan. On August 7, 2024, Savannah said that despite "substantial efforts of all parties", it had not been possible to complete the proposed transaction on the envisioned terms, and the original agreement had been terminated.
Simultaneously, PETRONAS announced that it had served notice to unilaterally withdraw from its interests in the relevant exploration and production sharing agreements.
Savannah said it remained in active discussions around an alternative transaction in relation to the PETRONAS assets.
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Savannah and PETRONAS have terminated their original agreement to sell PETRONAS' South Sudan assets to for up to US$1.25bn. However, Savannah remains in active discussions around an alternative transaction in relation to the assets. In the meantime, shares remain suspended on AIM pending publication of a document setting out the details of such a transaction, or confirmation that it will not be proceeding. A further update is expected in early September 2024.
In addition to pursuing the South Sudan acquisitions, signed a deal in March 2024 to acquire 100% of SIPEC, whose main asset is a 49% interest in the Stubb Creek field in Nigeria. The purchase would consolidate 's interest in the asset and enable it to double production from the field to 4.7 Kbopd within 12 months via a planned de-bottlenecking programme.
Savannah's ambitious energy diversification strategy is also advancing at pace with 696 MW of renewable projects in motion throughout Africa. The company continues to move toward its near-term target of 1 GW of renewable projects in motion by end of 2024, and 2 GW by end of 2026.
Savannah met or exceeded its financial guidance for FY23, with total revenues of US$261m (11% ahead of guidance), and operating expenses of US$68.8m (8% below guidance). Capex was US$13m compared to guidance of 'up to US$30m'. The average realised sales price was US$4.51/Mscfe, a 9% increase on FY22. Average gross daily production was 23.6 Kboepd, broadly in line with FY22 LFL.
For FY24, Savannah expects total revenues in excess of US$245m, operating and administrative expenses of up to US$75m, and capital expenditure of up to US$50m.
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