Business, Economics and Jobs

Ophir Energy, African exploration firm, to list on London Stock Exchange

The fabled riches of Ophir may be found in Africa — and on the London Stock Exchange.

Ophir Energy, the firm developing a hot track record for exploring and exploiting energy deposits in Africa, announced Thursday that it will list on the London Stock Exchange

The African exploration firm, backed by Lakshmi Mittal, one of Britain’s richest men, is set to tap into the demand for energy stocks. Ophir is expected to value at more than $1 billion, making it one of the largest oil exploration entries on the London stock exchange.

So big money can be made in Africa — but will Africans benefit from it?

Founded in 2004, Ophir has notched up a string of exploration successes, with five discoveries from eight wells drilled since 2008. Two were gas discoveries in Equatorial Guinea and three were gas discoveries in Tanzania.

Opir's current portfolio comprises 17 assets in eight countries in Africa. It is the fifth largest holder of deepwater acreage in Africa. The company has approximately 90,000 square kilometers of net exploration acreage.

The company plans to undertake an extensive exploration program with plans to drill 11 wells in four countries over the next 18 months.

Ophir hopes to raise up to $400m through the sale of new shares to fund further exploration. It has some high-profile backers, including Mittal Group, which owns 21 percent. Poland’s wealthiest man, Jan Kulczyk, is another backer with 13 percent while Och-Ziff, the asset manager, holds 13 percent.

African investors include Mvelaphanda Holdings, the South African company founded by former freedom fighter and South African politician Tokyo Sexwale, with a 3.8 per cent share.

The company acts as operator on most of its projects and usually holds a high level of equity as a way of being able to control the timing and scale of any expenditure.