Afentra Tipped for Upside as It Lands Large Onshore Block in Angola

Afentra plc has acquired a 35% interest in Block KON4 in Angola, which includes the Quenguela Norte field, previously the largest onshore discovery. Analysts suggest the acquisition could significantly increase Afentra’s share value, forecasting potential targets ranging from 88.8p to 106p. The acquisition opens avenues for exploration and production in an under-explored region of the Kwanza basin, attracting positive commentary from various analysts.

Afentra plc has garnered attention in the market following its acquisition of a significant asset in Angola, which includes some of the country’s most prolific oil and gas discoveries. The company now owns a 35% interest in Block KON4, situated in the Kwanza basin. Notably, this block comprises the Quenguela Norte field, once Angola’s largest onshore discovery, boasting an impressive reservoir of over 200 million barrels, with peak production recorded at 12,000 barrels per day (bopd).

The newly acquired Block KON4 encompasses eleven historical oil fields and two gas fields, which together produced around 90 million barrels over time. Analysts predict that Afentra’s shares could potentially nearly double in value, thanks to this acquisition. The company’s strategy appears to be effective, as it expands its presence in Angola while tapping into underexplored regions.

Stifel analyst has reiterated a ‘buy’ recommendation for the company, setting a price target of 106p, while the shares currently trade at 54p. He stated that the value from the onshore Kwanza licenses is not yet reflected in their estimates, but they foresee significant opportunities for low-cost development or exploration activities that could enhance future earnings.

Further support for Afentra comes from Cavendish, which also places a ‘buy’ rating on the firm, recommending a target price of 88.8p. Shore Capital sees the potential value of Afentra shares at around 101p. Analysts note that the Kwanza basin, despite its known hydrocarbon potential, has not been explored as extensively as other West African onshore basins, which could pose substantial upside for Afentra.

James Hosie from Shore Capital pointed out that KON4 adds both exploration possibilities and the chance for earlier production phases. Meanwhile, James Midgley from Cavendish highlighted that this acquisition will contribute to maintaining regular news flow and engaging shareholders. He suggested that value from the onshore permits will be accounted for in the net asset value once a work program is confirmed by Afentra.

In summary, Afentra’s strategic acquisition of Block KON4 in Angola is poised to bolster its position in the oil and gas sector. With promising projections from various analysts and potential for both exploration and production, the company seems well-positioned for future growth. Investors will be keen to see how Afentra advances with its work programs and new developments as they unfold.

In light of Afentra’s recent acquisition of Block KON4 in Angola, industry analysts are optimistic about the company’s future. The acquisition not only solidifies their presence in the region but also opens doors for exploration and potential production. With strong buy recommendations and elevated price targets from Stifel, Cavendish, and Shore Capital, the anticipation surrounding Afentra’s next steps is palpable. The market will be watching closely as further developments materialize.

Original Source: www.proactiveinvestors.co.uk