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Africa Oil Corp. T.AOI

Alternate Symbol(s):  AOIFF

Africa Oil Corp. is a Canadian oil and gas company with producing and development assets in deepwater Nigeria and an exploration/appraisal portfolio in west and south of Africa, as well as Guyana. The Company is focused on its Nigerian assets, Namibian Orange Basin opportunity set (Blocks 2913B and 2912), Block 3B/4B in South Africa's Orange Basin, and Equatorial Guinean exploration blocks (EG-18 and EG-31). The Company holds its interests through direct ownership interests in concessions and through its shareholdings in investee companies, including Prime Oil & Gas Cooperatief U.A. (Prime), Impact Oil and Gas Ltd (Impact), Africa Energy Corp (Africa Energy) and Eco (Atlantic) Oil & Gas Ltd. (Eco). Prime is a Nigeria-focused company with interests in OML 127 and OML 130 that account for all of the Company's reserves and production. Eco is an oil and gas exploration company with interests in Guyana, Namibia and South Africa. Impact has interests in Namibia and South Africa.


TSX:AOI - Post by User

Bullboard Posts
Comment by StupidInvestoron Jan 15, 2010 4:16pm
263 Views
Post# 16685222

RE: RE: RE: RE: RE: RE: Bhogal-1: 3200 meters on D

RE: RE: RE: RE: RE: RE: Bhogal-1: 3200 meters on DDon't know. You'd have to calculate cash, capital commitments, potential net pay in case of discovery, and compare the two companies. A premium is typically paid on Lundin companies because of management, access to capital, access to quality opportunities, and the fact they take responsibility for their shareholders (like when BBP failed it became SNM). In contrast, LEO's management track-record isn't stellar. Decisions like suingInternet posters makes you question their focus. And if the drillingsfail, they're going to end up in a much tougher situation than AOI.

According to AOI's latest presentation, their strategy is to get a 30-40% working interest with 0% paying interest in all of their concessions. This is an attractive strategy as it would alleviate their capital commitments and take us for a free ride. LEO don't have that luxury. When comparing the two, you're going to have to take all of that into account. In short, it's my opinion that the risk is greater in LEO, but you definitely should look at what the rewards are in case of success and consider it. Might be the numbers turn out it's worth taking the risk because the rewards are massive.
Bullboard Posts