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VOG signs up to supply Aksa in Cameroon

The 25-year deal includes the possibility to extend for five years

Victoria Oil& Gas (VOG) and Cameroon subsidiary Gaz de Cameroun (GdF) have agreed a non-binding term sheet to supply Turkish power contractor Aksa Enerji Uretim with up to 25 million cubic feet a day of gas for a proposed power station at Bekoko, located close to the commercial port city of Douala.

Subject to conditions precedent and government approval, the 25-year deal includes the possibility to extend for five years and a 70% take-or-pay option plus a commercially defined gas tariff of $6.75 per million British Thermal Units (MMBtu).

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Aksa and the Ministry of Water Resources & Energy earlier this year inked a memorandum of understanding (MoU) to develop a 150 MW substation at Bekoko near existing gas pipeline infrastructure operated by GdC – both parties are already working the local utility ENEO to advance the scheme.

VOG intends the term sheet will lead to a long term grid power contract requiring GdF to bolster supply by committing expand development of the Logbaba field and develop the Matanda block to meet contract obligations.

“If work begins as planned in late 2020, then projected production levels would dwarf current gas sales and propel VOG into a profitable trajectory of growth,” said VOG chief executive Ahmet Dik.

Dik said he valued Aksa Energy’s “depth of experience in installing and operating successful gas facilities across Africa” and the two companies would work closely to deliver first gas and power.

Aksa Energy currently sells 14 terraWatts per hour (TWhr) of energy annually and operates a 370 MW power plant in Ghana, Mali 40 MW and Madagascar 66 MW.

AIM-listed VOG owns and operates the Logbaba gas Project with 57% equity alongside RSM Production 38% and state owned SNH 5%, while the nearby Matanda transition one licence is operated by VOG with 75% equity alongside Afex Global 25%.

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