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Stonegate Capital Partners Initiates Coverage on Erin Energy Corporation (NYSE American: ERN)

DALLAS, TX / ACCESSWIRE / August 16, 2017 / Stonegate Capital Partners updates research coverage on Erin Energy Corporation (NYSE American: ERN).


Erin Energy Corporation (ERN) is an independent oil and gas exploration and production company, originally founded in 1986 as Camaroon-American Company ("CAMAC"). The Company has an asset portfolio of five licenses located in three countries in Africa, covering approximately 1.5 million acres. The Company's asset portfolio includes production and exploration projects in offshore Nigeria, exploration licenses in offshore Ghana, and offshore/onshore licenses in Kenya. In The Gambia, Erin Energy has offshore licenses and a farm-out agreement with FAR Ltd. (FAR), an Australian-based oil and gas exploration company. Erin Energy Corporation trades on the New York Stock Exchange American, as well as the Johannesburg Stock Exchange under the ticker symbol ERN, and is headquartered in Houston, Texas, with 74 full-time employees, 32 of which were employed in the U.S. and 42 in Africa as of year-end 2016.


The next 6 -12 months should provide some important catalysts for Erin Energy.

  • ERN's current production is approximately 5,000 - 6,000 barrels of oil per day from its Oyo-8 well; exploration and production are currently concentrated in the Oyo Field located in oil mining leases ("OML") 120/121 blocks offshore Nigeria.
  • The Company is finalizing plans to commence drilling operations on its Oyo-9 well in Nigeria. The Pacific Bora drilling rig has arrived, and under the Company's agreement with Pacific Drilling (PACD), drilling on Oyo-9 is scheduled to begin by the mid-August, with a targeted completion date of year-end 2017. The Oyo-9 well is expected to increase production of the Company's Oyo Field by 6,000 to 7,000 barrels of oil per day ("BOPD").
  • A planned tie back of the Company's Oyo-7 well to its floating production storage and offloading ("FPSO") unit could add an additional 1,200- 2,000 BOPD. These plans along with drilling operations beginning at Oyo-9 should more than double Erin Energy's production in the short term, providing additional cash flow.
  • Located offshore of Nigeria, the Niger Delta system, where more than 40 billion barrels of oil have been discovered, is one of the largest tertiary deltas and most prolific hydrocarbon systems in the world. Erin Energy has 100% interest and ownership of OML 120/121 in the Western Niger Delta, where the ERN is planning to drill its development well and possibly, depending on financing and rig availability, a high-impact exploration well (Oyo NW).
  • The Miocene formation, the geological sequence where the Company's prospects are located, is a recognized significant producing formation. Erin Energy's OML 120/121 blocks in the Miocene formation are surrounded by Chevron (CVX), Exxon Mobil (XOM), and Royal Dutch Shell (RDS) fields that have produced a number of significant hydrocarbon (primarily oil-based) discoveries. The prospective drilling into the Miocene formation could be a significant game-changer for Erin Energy.
  • The quality of the light, sweet oil that is produced in Nigeria is superior to standard Brent crude oil, and therefore, commands a $1-$2 premium to the price of Brent oil.
  • Management is in the midst of pursuing multiple actions to address the Company's financial structure, including restructuring the debt, seeking deferment of debt, reducing operating costs, minimizing projected capital costs, pursuing additional public or private funding, and finding additional farming-out opportunities.
  • Based on ERN's current reserves and our analysis of precedent transactions, we believe that the Company's share price could trade in the $3 - $4 range, assuming that ERN continues to make progress on its capital structure, successfully sources funding as needed, and moves forward with the drilling of additional wells in the near-term . See full report for further details.

The full report can be accessed by clicking on the following link:


About Stonegate Capital Partners

Stonegate Capital Partners is a Dallas-based corporate advisory firm dedicated to serving the specialized needs of small-cap public companies. Since our inception, our mission has been to find innovative, undervalued public companies for our network of leading institutional investors who seek high quality investment opportunities.

SOURCE: Stonegate Capital Partners