Shares in Victoria Oil and Gas (VOG) were given a boost after the firm's flagship Logbaba site delivered its first commercial gas production on schedule.
The firm's wholly owned subsidiary made the delivery to customers on the Magzi Industrial Estate in Douala, Cameroon, on 17 December.
VOG's Executive Chairman Kevin Foo said: "This is a very significant milestone for the company. We have now moved from an exploration and development company into a producer. The development of Logbaba is also important news for the city of Douala. The commissioning of two wells, production facilities and the first stage of the pipeline was successful and without incident."
Start your trial of MoneyWeek today
Get unparalleled financial insight, analysis and expert opinion you can profit from.
Start your trial
Sign up for MoneyWeek’s free twice-daily newsletter.
Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.
Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.
Meanwhile, the second stage of pipeline network is under contruction and is expected to reach completion in the second quarter of 2012. Production is expected to soar from 8 million standard cubic feet per day (mmscf/d) by the end of 2012 to 44 mmscf/d by the end of 2014.
Latest Videos FromMoneyWeek
Condensate sales are similarly anticipated to be 160 barrels of condensate per day by the end of 2012, rising to 880 barrels per day by the end of 2014.
Logbaba, in which VOG has a 95% interest, has gross proved and probable reserves of 212 billion cubic feet of gas and 4.2 million barrels of condensate.
The company has two wells completed as producers and estimates that there are additional prospective resources in excess of 1 trillion cubic feet of gas with associated condensate within the exploitation area.
The firm anticipates that the pipeline is of sufficient size to satisfy the Douala industrial market over the medium term.
The share price, which has fallen 20% over the past year, had stabilised at 3.95p by 09:15.
NR
