Bowleven hails '˜milestone' Cameroon project stake sale

Oil and gas explorer Bowleven has struck a deal to sell an 80 per cent stake in an onshore project in central Africa.

Africa-focused Bowleven will retain a 20% in the Bomono project. Picture: Contributed

The Edinburgh-based firm hailed the farm-out agreement with Victoria Oil & Gas (VOG) as a “milestone” and said it would generate “attractive returns” compared with an option to sell gas from the development for a power scheme in Cameroon.

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Under the deal, Bowleven will remain as operator of the Bomono project with an 20 per cent stake. It will also receive £100,000 worth of shares in fellow Aim-quoted company VOG, along with royalties of 3.5 per cent.

Chief executive Kevin Hart said: “This deal offers shareholders the opportunity to access VOG’s robust commodity pricing framework, which offers attractive returns relative to a gas-to-power option, and requires minimal further investment by Bowleven to reach first production.”

The agreement, which is subject to approval from the Cameroon government, comes as Bowleven prepares for a showdown with rebel shareholder Crown Ocean Capital, which is seeking to replace most of the board members and convert the Africa-focused business into a holding company. Investors will vote on Crown’s plans at a general meeting to be held on 14 March.

VOG has the right to terminate the Bomono farm-out deal if any of Crown’s resolutions are approved at the shareholder gathering.