Block Energy announced a conditional transaction with Pilgrim Exploration to finance its entry into two offshore production sharing contracts in Gabon.
Block Energy plc took a key step outside its Georgia operating base by agreeing to an investment linked to the Ndjila and Mpari production-sharing contracts, located off the coast of Gabon. The transaction will be financed through a proposed $6.3 million raising of new common shares, structured in two closings.
With this transaction, the company seeks to add to its portfolio two contiguous offshore licenses covering 5,331 km² in the northern Gabon Basin. The area boasts four historical oil discoveries and a wealth of technical data, including near-complete 3D seismic coverage acquired in 2017.
A low-cost entry into assets with discovered oil
According to the company, the transaction represents an opportunity to access oil-bearing assets in a well-established oil-producing jurisdiction. The agreement includes a convertible loan in favor of Pilgrim, which, through its subsidiaries, owns a 90% operating stake in the Ndjila and Mpari PSCs. The remaining 10% belongs to the State of Gabon.
Following the loan conversion, subject to applicable regulatory approvals, Block Energy would hold a 76.5% economic interest in the contracts. Pilgrim would retain 13.5%, and the State of Gabon would maintain its 10%.
Furthermore, Pilgrim will continue as the operator of the PSCs during the initial phase, with technical support from Block Energy. This structure allows the British company to gain financial exposure from the outset and postpone any formal legal transfer until it has obtained the necessary authorizations.
Ndjila and Mpari strengthen Block Energy’s diversification
To date, Block Energy has focused its main activity in Georgia, where it participates in seven production-sharing contracts in the Kura Basin. Its Georgian portfolio includes oil and gas assets and potential for carbon capture and storage .
Now, Gabon adds a new geographic and geological dimension to the company’s strategy. For Paul Haywood, CEO of Block Energy, the transaction combines discovered oil with high-potential exploration in a recognized producing jurisdiction. He also highlighted that the agreement brings near-term growth to the portfolio, following recent progress on Projects III and IV in Georgia.
Likewise, the entry into West Africa leverages the experience of Block Energy’s board of directors in the region and strengthens its profile as an independent energy company with high-impact assets.
Iguega will be the initial technical focus
The Iguega field is emerging as the main asset in the portfolio. According to the information released, Shell conducted preliminary work on a development concept, and the discovery well proved to produce 3,300 barrels of oil per day.
In addition to Iguega, the licenses include three other oil discoveries: Ekouata, Topaz, and Pilote. Block Energy will evaluate these fields to define potential subsequent development phases.
The initial technical program includes the integration and interpretation of subsurface data, the refinement of the Iguega development concept, the evaluation of other discoveries, and the complete mapping of mining licenses. Opportunities in pre-salt and post-salt sections will also be analyzed.
The proposed financing involves a share placement through an accelerated book-building process and a retail offering targeted at existing shareholders. The issue price will be 1.1 pence per share.
The firm placement anticipates the issuance of 77,314,724 shares to raise approximately US$1.154 billion. The remaining balance will depend on the approval of shareholder resolutions at a general meeting scheduled for May 18, 2026, with gross proceeds of up to US$5.130 billion.
The retail offering will include up to 13,636,363 shares to raise around £150,000. This portion will be part of the conditional tranche and will be conducted through the Winterflood Retail Access Platform.
Gabon is gaining traction as an offshore destination in West Africa.
The northern Gabon Basin is a mature hydrocarbon province with established operators, export routes, and a long production history. Block Energy believes that recent activity by companies such as Exxon, BP, and Trafigura reinforces confidence in the country’s potential.
Furthermore, the dataset available in Ndjila and Mpari could accelerate prospect maturation and development planning. The company expects that the progress of the technical program will help attract interest for asset-level financing, both in development and exploration.
Source: Block Energy
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