Savannah Energy (SAVE)

Sector:

Energy Producers

Index:

FTSE AIM 50

26.05p
   
  • Change Today:
    -0.60p
  • 52 Week High: 40.20p
  • 52 Week Low: 19.35p
  • Currency: UK Pounds
  • Shares Issued: 1,306.10m
  • Volume: 602,138
  • Market Cap: £340.24m
  • RiskGrade: 340

Savannah Energy subsidiary enters gas sales agreement in Nigeria

By Josh White

Date: Friday 05 Feb 2021

LONDON (ShareCast) - (Sharecast News) - Africa-focussed Savannah Energy announced on Friday that its Accugas subsidiary has entered into a new gas sales agreement with Mulak Energy.
The AIM-traded firm said the agreement was initially for a seven-year term, and envisaged the supply of gas produced by Savannah's majority-owned Uquo field for an initial two-year period on an interruptible basis, with the subsequent five years on a firm contract basis.

During the interruptible gas delivery period, Mulak would be able to nominate a maximum daily quantity of up to 2.5 million standard cubic feet per day.

Volumes in the firm delivery period would be agreed by the parties before the end of the interruptible period.

The company said the gas sales agreement was priced to reflect Mulak's status as an industrial customer, and thus Accugas expected to see its weighted average gas sales price realisation increase as a result of the contract, without the need for any incremental capital expenditure beyond its previously-announced plans.

Sales under the agreement would benefit from a bank guarantee arrangement from an investment-grade, credit-rated international bank.

Savannah noted that Mulak is a member of the Egypt-based conglomerate Mansour Group, which operates in more than 100 countries and has annual revenues exceeding $7.5bn (£5.48bn).

The agreement for the supply of gas to Mulak's Nigeria compressed natural gas (CNG) Nigerian project represented Savannah's first gas-to-CNG agreement.

Mulak was initially planning to distribute CNG to its industrial customers in Rivers State, with the CNG to be substituted for diesel in generators supplied by the Mantrac Group, which is also a member of the Mansour conglomerate and is one of the world's largest dealers in Caterpillar machinery, power systems and equipment.

Savannah said Mulak was in a "unique position" to exploit the synergies with Mantrac's business in Nigeria through the conversion of Mantrac's existing customer base of around 400MW of diesel-fuelled generators to CNG-fuelled generators.

That was expected to provide Mantrac customers with up to a 40% saving in energy costs, and a 30% reduction in their carbon footprint.

Sales under the gas sales agreement were expected to start in 2022 and, following the initial two-year period, Mulak had indicated that it was seeking to expand its CNG sales on a pan-Nigeria basis to Mantrac customers.

Accugas was continuing to make "good progress" in relation to agreeing further potential new gas sales agreements with new customers, Savannah reported, with further updates to be provided in due course.

"We are delighted to announce this new gas sales agreement with Mulak Energy and the Mansour Group," said Savannah chief executive officer Andrew Knott.

"This recognises Accugas' status as the most reliable supplier of natural gas in Nigeria.

"Our first gas-to-CNG agreement is hugely exciting as it represents Savannah's entry into the compressed natural gas market, which we see as offering strong growth potential for our business over the course of the next decade."

Knott said the CNG market would "significantly extend" the reach of the company's existing 260 kilometre pipeline network into light industrial and domestic power generation, without the need for further investment in pipelines.

"For example, the Mansour Group subsidiary, Mantrac, currently has an installed customer base of approximately 400MW of diesel-fuelled power generation, which has grown every year for the last decade."

At 1011 GMT, shares in Savannah Energy were up 3.96% at 17.05p.

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Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.

Note 2: RiskGrade figures are provided by RiskMetrics.

 

Savannah Energy Market Data

Currency UK Pounds
Share Price 26.05p
Change Today -0.60p
% Change -2.25 %
52 Week High 40.20p
52 Week Low 19.35p
Volume 602,138
Shares Issued 1,306.10m
Market Cap £340.24m
RiskGrade 340

Savannah Energy Star Ratings

Compare performance with the sector and the market.
more star ratings
Key: vs Market vs Sector
Value
82.3% below the market average82.3% below the market average82.3% below the market average82.3% below the market average82.3% below the market average
70.73% below the sector average70.73% below the sector average70.73% below the sector average70.73% below the sector average70.73% below the sector average
Price Trend
51.36% above the market average51.36% above the market average51.36% above the market average51.36% above the market average51.36% above the market average
38.64% above the sector average38.64% above the sector average38.64% above the sector average38.64% above the sector average38.64% above the sector average
Income
93.18% below the market average93.18% below the market average93.18% below the market average93.18% below the market average93.18% below the market average
85.71% below the sector average85.71% below the sector average85.71% below the sector average85.71% below the sector average85.71% below the sector average
Growth
14.51% above the market average14.51% above the market average14.51% above the market average14.51% above the market average14.51% above the market average
15.38% above the sector average15.38% above the sector average15.38% above the sector average15.38% above the sector average15.38% above the sector average

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Savannah Energy Dividends

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Trades for 09-Dec-2022

Time Volume / Share Price
12:30 9,186 @ 26.05p
12:30 330 @ 26.30p
12:30 3,055 @ 26.30p
12:30 2,499 @ 26.30p
12:30 50,000 @ 26.07p

Savannah Energy Key Personnel

CEO Andrew Knott

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