We seek to realise sustainable value for our stakeholders through the successful delivery of material energy projects in Africa
What we do1
Through the acquisition of seismic and other geophysical data and detailed subsurface studies, we build exploration portfolios and identify drilling targets. Through exploration and appraisal drilling we find oil and gas reserves and resources to be produced and monetised in the future.
We drill wells and install surface networks to enable oil and gas reserves to be produced.
We invest in infrastructure to process and transport produced hydrocarbons to end customers.
Our reinvestment strategy is to prioritise opportunities that have the potential to deliver high-quality cash flows and are net asset value-accretive. To this end, we expect to reinvest in projects that extend the economic life of our existing asset base and we plan to acquire assets that either have synergies with our existing portfolio, or represent new ventures which are aligned with our corporate purpose and strategy.
We have a funnelled approach to business development. For potential acquisitions, we identify upstream and midstream opportunities, and evaluate them in line with our business growth plans and capital allocation strategy. Our expectation is that all chosen projects, both hydrocarbons and power, meet similar risk-adjusted investment return thresholds.
Our power business model, the remit of which has recently been repositioned to include thermal as well as renewable energy projects, presently focuses on three key areas: acquiring operational assets, participating in projects already underway, and developing new projects in house. For greenfield projects we undertake resource assessments and obtain the necessary authorisations, then carry out preliminary engineering and environmental and social impact studies. We then negotiate long-term power purchase agreements and construction contracts and procure project financing.
Once greenfield project development planning is completed, we intend to invest in the construction phase, which will be carried out via comprehensive-scope construction contracts managed by Savannah and financed through a mixture of Savannah’s equity and long-term structured finance.
Whether acquired or developed, we plan to become a long-term owner and operator of power generation projects, managing the technical and commercial aspects, with a focus on continued optimisation of energy production.
Our reinvestment strategy is to prioritise opportunities that have the potential to deliver high-quality cash flows and are net asset value accretive. For potential acquisitions, we identify power project opportunities, evaluate them in line with our business growth plans and capital allocation strategy. Our expectation is that all chosen projects, both hydrocarbons and power, meet similar risk-adjusted investment return thresholds.
- Below shows the principal aspects of the business model we expect to follow, based upon the typical lifecycle of oil and gas and power projects. This discussion is provided for illustrative purposes only and it should be noted that Savannah is not participating in projects at every stage of the respective project lifecycles currently.
