UK-based Block Energy PLC has signed a conditional agreement to acquire interests in two offshore oil blocks in Gabon, marking its first expansion into Africa as interest in the country’s underexplored offshore basins grows despite declining national production.
The agreement, concluded with fellow British firm Pilgrim Exploration Limited, covers production sharing contracts for the Ndjila (G4-269) and Mpari (G4-270) blocks located offshore Gabon. The combined acreage spans more than 5,300 square kilometres.
According to the companies, the licences include four previously identified oil discoveries, including the Iguega field, where past testing reportedly produced flow rates of up to 3,300 barrels per day. Pilgrim said the blocks also benefit from extensive existing subsurface data, which could support faster exploration and appraisal activities.
Block Energy said the transaction remains conditional on regulatory approvals in Gabon and the completion of financing arrangements.
The company plans to extend a convertible loan to Pilgrim Exploration, which currently holds a 90% interest in the production sharing contracts through its subsidiaries. Following conversion and regulatory clearance, Block Energy would secure an indirect economic interest of 76.5% in the licences.
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To fund the deal, Block Energy intends to raise $6.3 million through a combination of a private placement and an offer to existing shareholders.
“This transaction represents an excellent value-accretive acquisition of discovered oil and high-potential exploration in a well-known oil producing jurisdiction,” said chief executive Paul Haywood.
Block Energy, which currently generates most of its $7.22 million in annual revenue from operations in Georgia, would be entering the African oil market for the first time if the acquisition is completed.
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The move comes as Gabon seeks to attract new investment into its offshore petroleum sector, even as national output has declined over the past two decades.
Gabon’s oil production stood at about 230,000 barrels per day in 2024, according to the Ministry of Petroleum and Gas, down from historical highs reached in the late 1990s.
However, authorities say a significant portion of the country’s petroleum acreage remains underdeveloped. Petroleum Minister Mays Mouissi Nguema said last year that only about 27.5% of Gabon’s oil blocks are currently under active development, leaving substantial room for new exploration.
Industry analysts say renewed interest in Gabon’s offshore basins reflects a broader trend among smaller independent producers seeking undervalued assets in mature but underexplored African oil provinces.
Despite high offshore exploration costs and technical risks, companies are increasingly targeting regions with existing discoveries and available geological data, which can reduce early-stage exploration uncertainty.
If completed, Block Energy’s entry would add to a growing list of smaller international operators seeking exposure to Africa’s oil and gas sector amid shifting global energy investment patterns.
