Red Sky Energy, an Australian exploration and production company, has recently entered Africa’s oil and gas market by acquiring a 35% stake in Block 6/24, offshore Angola. This move marks the company’s first international venture in Africa, and CEO Andrew Knox credits the Angola Oil and Gas (AOG) conference for playing a crucial role in facilitating the deal.
During his participation in a panel discussion at AOG 2024, Knox highlighted the attractiveness of Angola as a destination for Red Sky Energy’s expansion. With Angola’s production standing at around 1.1 million barrels per day, the country offers a well-established market with ample opportunities for growth. Red Sky Energy focuses on proven resources, developed assets, and discovered resources that can be developed and brought to market with their expertise. Angola’s supportive government, recent structural changes, and improved fiscal terms were key factors that drew the company to the market.
The acquisition of a stake in Block 6/24 presents significant potential, especially with the presence of the Cegonha oil discovery. Located just 12km from Luanda and the refinery, the block offers convenient access and existing infrastructure. Despite the heavy crude with an API of approximately 20, nearby fields already produce similar types of crude, making it viable for production and potential offtake agreements.
Red Sky Energy has partnered with Sonangol, the national oil company, and ACREP for the development of Block 6/24. With a 35% stake, Sonangol operating with 50%, and ACREP with 15%, the collaboration brings together local market knowledge, operational expertise, and nimble solutions for field development.
The agreement outlines a timeline for extensive geological and geophysical studies over three years, leading to a potential drilling decision in Year 4. Red Sky Energy aims to reprocess existing seismic data, assess development options, and potentially expedite the drilling decision. Beyond Block 6/24, the company envisions establishing a significant presence in Angola by focusing on existing discoveries and production opportunities.
Reflecting on their experience at Angola Oil and Gas 2024, Knox emphasizes the conference’s instrumental role in connecting with industry players, exploring opportunities, and paving the way for future deals. The well-organized and informative event provided valuable insights and networking opportunities, prompting Red Sky Energy to consider further prospects in Angola.
In conclusion, Red Sky Energy’s entry into Angola’s oil and gas market signifies a promising venture with plans for future growth and expansion in the country. Stay tuned for more developments as the company navigates the African energy landscape.
