Afren is a leading independent exploration and production company - listed on London's Main Market and a constituent of the FTSE 250.
Our portfolio now extends to 31 assets in 12 countries, from Nigeria, Ghana, Côte d'Ivoire, Nigeria and São Tomé & Príncipe JDZ, Congo Brazzaville and South Africa, East African opportunities in Ethiopia, Kenya, Madagascar, Seychelles, Tanzania and more recently the Middle East through entry to the Kurdistan region of Iraq.
Our activities span the full-cycle E&P value chain of exploration, appraisal, development through to production, and are focused in areas that represent globally significant and growing sources of international oil supply and high impact exploration fairways.
Maintaining strong relationships with indigenous companies, National Oil Companies and suppliers are top Afren priorities - as are ambitious Corporate Social Responsibility and ethical policies that ensure significant resources re-enter local economies.
Together, these unique factors have contributed to Afren's strong positioning in the E&P universe.
Commitment to Excellence
Our strength at Afren is our ability to translate the wealth of our combined individual experiences into sustainable long-term value for not only our stakeholders, but also the countries that we operate in.
Performance driven by Self Belief
Our commitment to become the premier London listed independent upstream E&P drives us to higher levels of performance. Belief in our combined abilities to succeed in the challenging environment that we work in, gives us impetus to explore new ideas as we strive to exceed our targets.
Unconventional and Innovative
We are willing to take up new challenges. We are not afraid to try new approaches in the way we work; we thrive on being innovative in all areas of the business and reward those who show leadership in these areas.
Trust through Open Communication
At Afren, we understand the importance of connecting with our employees, our business partners and our shareholders - our success depends on everyone. We encourage an environment of continuous communication and build our relationships on trust.
Commitment to Continuous Development
We have learnt from past experiences. The information, ideas and conclusions from these experiences drive our continuous improvement. We are prepared to adapt ourselves to maintain a high impact in an environment where the only constant is change.
A strategy that delivers growth
Afren's strategy is to consolidate on its position as a leading London listed independent upstream E&P company. At the heart of Afren's strategy are four key objectives against which we measure our progress.
Afren's Business Model
Our vision to be the leading London listed independent upstream exploration and production company is underpinned by a clear and consistent strategy - one that is designed to provide a framework for sustainable long-term growth across the full cycle E&P value chain.
A closer look at our strategic priorities sets them in the context of Afren's growth to date.
From the outset one of our key priorities was to establish a reliable platform of cash generative reserves and production that would lead us ultimately to a sustainable position of internally generated cashflows funding activities across the full cycle exploration and production value chain. At the same time we recognised early signs of a trend in key markets, notably in Nigeria, towards greater indigenous ownership of assets and participation in the oil sector, and that opportunities would increasingly present themselves for an aligned partner that could provide the necessary technical solutions and access to capital in support of this.
The vast number of discovered but undeveloped assets that exist in Africa, particularly in the shallow water areas of offshore Nigeria, is an opportunity set that lends itself ideally to the early achievement of these objectives and remains a core focus for Afren today. Through forging strong partnerships early on with indigenous companies such as Amni International and Oriental Energy Resources, we have accessed and successfully monetised important reserves and production, firmly establishing a "growth engine" of increasing production and cashflow for the Company and developing a comprehensive technical skill set and operating track record. It is this track record and skill set that has enabled the Company to uniquely position itself in Nigeria as a partner of choice, and in particular to pursue larger scale opportunities that are starting to arise out of the major IOC's portfolios alongside indigenous partners such as First Hydrocarbon Nigeria.
This track record has also enabled Afren to leverage its core skill set and progressively target larger scale opportunities in other regions of interest that may exhibit parallel themes; ie. geologically low risk, fast track development opportunities where Afren is strategically and competitively advantaged. The acquisition of an interest in two contiguous PSC's, Barda Rash and Ain Sifni, located in the Kurdistan region of Iraq is an example of this and an opportunity that lends itself to Afren's strengths. With a large volume of oil already discovered and substantial low risk exploration upside, this complementary extension to the portfolio is a unique opportunity for us to deploy the production and development expertise we have developed over the past six years in Nigeria and benefit again from an early mover advantage in one of the worlds most prospective yet relatively immature hydrocarbon regions.
Read more about our production and development opportunities here
Pursue materially accretive acquisitions
Against a backdrop of increasing global demand for hydrocarbons, and with competition for upstream assets ever intensifying, a core and proven ability of Afren's is to seek out and access opportunities that offer substantial reserves potential on economically attractive terms at a low unit cost.
The African and Kurdistan region of Iraq (KRI) opportunity sets are attractive to us on many levels. Most fundamentally the resources are there, in abundance, and ongoing exploration continues to yield world class results. In particular, Nigeria and Iraq are ranked as two of the world's top 10 proved oil reserves and top 12 oil producers. Importantly the potential exists for this trend to continue long into the future, with numerous under-explored basins and under-developed/overlooked/misunderstood fields offering an agile independent such as Afren large scale upside over the medium to long term.
Whilst a general industry theme over the past six years has been for acquisition costs to trend increasingly higher, our differentiated approach has allowed Afren to consistently deliver barrels into the portfolio at a cost of under US$4/bbl. We have been able to achieve this by playing to our strengths, avoiding overly competitive "bidding wars" for assets, focusing our efforts on opportunities where we are strategically advantaged, have a deep understanding of the subsurface, can leverage our track record and forge strong partnerships with key stakeholders. These are the factors that differentiate Afren today, and mean we are well positioned to continue the trend of adding low cost reserves to the business.
Organic reserves growth
Having sufficiently matured the business through the appraisal, development and production of key assets, the next step was to introduce an exploration portfolio that would offer a balanced exposure to organic upside, leveraging our underlying cashflow to internally fund a carefully selected exploration campaign across some of the world's highest profile hydrocarbon plays. The acquisition of Black Marlin Energy in 2010 marked the transformation point at which we began to realise our full cycle ambitions, building on our existing acreage position in West Africa and bringing scale and diversity to our exploration portfolio. We have continued to make selective additions to our exploration portfolio that is today focused around four core themes, namely
the proven Upper Cretaceous play concepts along the West Africa Transform Margin
low risk exploration close to existing fields in the prolific Tertiary systems of the Niger Delta
high impact, potentially play opening targets in the rift and coastal basins of East Africa
the prolific yet under-explored Zagros Fold Belt in the Kurdistan region of Iraq
Africa and the KRI still have much to offer in terms of exploration potential, and although some basins have been extensively drilled there are many that until now have attracted only limited interest from the international industry or been inaccessible in the past, but hold tremendous potential. We have carefully constructed an exploration portfolio that provides us with exposure across some of the Africa and the KRI's highest profile exploration fairways. From the under explored Upper Cretaceous systems of the West African Transform Margin to the barely drilled rift basins of East Africa and Zagros Fold Belt of the KRI, we have today a high grade prospect inventory encompassing a diverse spread of hydrocarbon play types and structural settings. With net un-risked prospective resources in excess of 3,600 mmboe, a major growth opportunity for Afren is in converting a significant portion of this prospective resource base into proved reserves by undertaking a sustainable internally funded exploration drilling campaign.
Operational efficiency and financial discipline
Underpinning all of our activities is a strict financial discipline and a conservative approach to managing our capital structure. Having established a cash generative platform of production, our first priority is to protect the cashflow requirements to execute our intended work programme in the context of a sustained downturn in oil prices. We aim to do this through ensuring operational efficiency, exerting downward pressure on our cost base at all times and promoting a culture of financial discipline and awareness at all levels throughout the organisation. We also prioritise the maintenance of a conservative balance sheet, and aim to diversify our sources of capital thereby reducing any potential over-reliance in any one area. In January 2011 we became the first UK listed independent E&P to go to the bond market and raise capital. A portion of the US$500 million bond has been used by the Company to repay certain shorter term facilities, the remainder of which combined with existing resources and positive cashflow from operations means we have the capital structure and financial flexibility to deliver our work programme and capitalise on future organic and inorganic growth opportunities.
Since the Company's listing in March 2005, Afren has rapidly expanded its portfolio and currently has a diversified portfolio of 31 assets across 12 countries spanning the full cycle E&P value chain. Afren is currently producing from its assets offshore Nigeria and Côte d'Ivoire and holds further interests in the Kurdistan region of Iraq, Ghana, Nigeria, Côte d'Ivoire, Congo Brazzaville, the Joint Development Zone of Nigeria -São Tomé & Príncipe, Kenya, Ethiopia, Madagascar, Seychelles, Tanzania and South Africa.