Panoro’s Fourth Leg: A Transformative Gas Entry into Ivory Coast
The company diversifies beyond oil with a 9% stake in Block CI-27, adding stable gas cash flow and scaling pro-forma production above 20,000 BOE/d.
PEN.OL · Earnings Call · 2026-08-20
A Transformative Entry
Panoro Energy’s half-year results were overshadowed by a strategic announcement that the market had not priced in: the acquisition of an indirect 9.09% interest in Block CI-27 offshore Ivory Coast from DNO. This is not a bolt-on but a fourth production leg, marking the company’s first foray into a new country and a material shift from an oil-weighted producer to a more diversified player with a meaningful gas component. Ivory Coast is a new jurisdiction for Panoro, and the company is clearly positioning for further growth there.The deal, priced at $80 million, includes a well-established gas asset that meets more than 70% of the country’s natural gas demand. Julien Balkany, Chairman, emphasized the strategic logic: “This latest acquisition, which will be our second this year, coming hot on the heels of our recent purchase of an additional 40% interest in Block G from Kosmos Energy. It will establish a fourth production leg to our business in a new first-class jurisdiction that has a very strong oil and gas sector” “.” — Julien Olivier Balkany, Executive or Senior Management · 2026-08-20 The company is issuing 7 million shares to DNO at NOK 28.77 and placing a $50 million senior unsecured bond with a 10.25% coupon, a structure that preserves cash while diversifying its credit profile.Eric d’Argentré, CEO, detailed the asset’s potential: “So lots of potential way past the 2034 PSC terms.” “.” — Eric d'Argentré, CEO and President · 2026-08-20 The block holds 520 Bcf of 2P reserves and more than 900 Bcf including 2C, with a drilling campaign already underway that is beating expectations. The first two wells have encountered higher pressure than expected, meaning the depletion assumption was conservative and can be revised upward.Why It Matters
The acquisition accelerates Panoro’s growth trajectory. Pro forma production now exceeds 20,000 BOE/day, with a target of 23,000 BOE/day in 2027. This is a significant scale-up from the 17,500 barrels reported today, and it underscores the company’s ability to execute on its “accretive M&A” DNA. As CFO Qazi Qadeer noted, “We continue to make distributions to our shareholders. And this morning, we have announced a NOK 50 million distribution for this quarter” “.” — Qazi Qadeer, CFO · 2026-08-20 The stable free cash flow from CI-27 — estimated at $17–20 million per year — will support the distribution policy while funding future growth.This move is a departure from the company’s recent focus on oil assets in Equatorial Guinea and Gabon. In prior calls, management repeatedly emphasized the importance of accretive M&A. As Julien said in May, “we have a very strong and exciting pipeline of growth opportunities” “.” — Julien Olivier Balkany, Executive Chairman · 2026-05-21 The Ivory Coast deal is the first material step beyond its existing footprint, and it brings a gas asset with a long-term take-or-pay contract, reducing commodity price volatility.The acquisition also positions Panoro for follow-on opportunities in CI 27, a region with significant oil and gas discoveries by Eni and Murphy. The country’s GDP growth above 6% and a BB- sovereign rating make it an attractive investment destination. The transaction is fully derisked with no regulatory approvals pending, and completion is expected by Q3.For investors, the deal is accretive on multiple fronts: it adds reserves, production, and cash flow while strengthening the balance sheet. The company’s share price has appreciated 4.5x since 2018, and this acquisition is likely to continue that trend. The new bond and share issuance are priced attractively, and the company is using its equity at a high valuation (NOK 28.77) to fund growth.The company’s strategy is clear: scale up through disciplined M&A while preserving a strong balance sheet and shareholder returns. The Ivory Coast entry is a classic Panoro move — well-timed, financially engineered, and backed by a high-quality asset. Cote d’Ivoire is not just a new country but a platform for the next leg of growth.But what’s most remarkable is the speed at which Panoro is executing. As Eric put it, “The first 2 wells have reached a reservoir with a higher pressure than expected, which is a very good news. It means that the depletion assumed is lower than it is in reality. So more volume to be produced.”