The Oil Man: Victoria Oil & Gas

Victoria Oil & Gas

Full-year 2016 figures from Victoria Oil which, although historic, give a good idea as to the significant advances made last year and so far this year.

Figures show net revenue of $32.8 million and EBITDA of $13 million on record gas sales of 10.2 million standard cubic feet per day (mmscf/d) up 24%. It is useful to know that this is still less than 10% of local demand.

These are good fundamentals despite a $32.7 million write off which includes $22.7 million on the Logbaba well La-106.

With $27 million spent on capital investment on drilling and the further pipeline extension VOG still has $14.4 million headroom on its BGFC debt facility.

The revenue is in line with company’s guidance, getting rid of a royalty is good going forward as are the non cash items. Operationally, drilling continues slowly hoping for no more gas kicks and ENEO are still taking gas so progress is justified.

Chairman Kevin Foo records 2016 as "a great year" with acquisition of extra acreage at Matanda and in 2017 the Bomono deal probably "a game changer" for VOG.

The company isnow firmly in control of the Douala Basin and a recent visit showed quite how much potential there is in the City.

VOG has come on in leaps and bounds and the investment community have so far appreciated that by doubling the share price so far this year. The headline figures have concerned some this morning, but the underlying picture is still very good with huge upside potential in the share price.

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.