Maha Energy AB (publ) (“Maha” or the “Company”), announces that the Company has ended the liquidity provider agreement for Maha's share with Lago Kapital. The agreement will end after the trading day on 13 February 2025.
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Maha to receive MUSD 4.4 Earn Out for the 2023 sale of Brazilian Assets
Maha Energy AB (publ) (“Maha” or the “Company”) is pleased to announce that it will receive an MUSD 4.4 oil price-related earn-out during the first quarter of 2025 (the “2024 Brent Earn Out”). This payment is part of the sale of its former Brazilian subsidiary (which held working interest under Tie and Tartaruga oil fields, onshore Brazil), closed in early 2023.
In February 2023, Maha completed the sale of its Brazilian subsidiary (i.e., the former Maha Brazil) to PetroRecôncavo, for a total purchase consideration of MUSD 150.9, plus additional earn-outs, contingent on certain contractual conditions.
A portion of the earn-outs is tied to the average annual Brent DTD oil price for the years 2023 to 2025 (the “Brent Earn Out”), payable if Brent DTD exceeds at least USD 80 per barrel, with a maximum payout if the Brent DTD price exceeds USD 90 per barrel.
In addition, Maha received in 2024 another parcel for the Brent Earn Out, amounting MUSD 1.5 (the “2023 Brent Earn Out”). For 2025, Maha could potentially receive a remaining parcel of the Brent Earn Out of up to MUSD 7.2.
Update on Brava Energia – Major developments announced
Brava Energia S.A. (“Brava”) announced 31 December 2024 that oil production had started at FPSO Atlanta (“first oil”). Brava announced in December 2024 that the Brazilian National Agency of Petroleum, Natural Gas and Biofuels ("ANP") had authorized the resumption of production in Papa Terra and the commencement of production at FPSO Atlanta. In addition, Brava announced 30 December the conclusion of its acquisition of a 23% stake in Parque das Conchas. Brava is a listed Brazilian oil and gas company in which Maha holds an equity interest of 4.76%.
Papa Terra
On 27 December, Brava received the authorization from ANP to resume production at Papa Terra, with production restarted before the end of the year. Production at the oil field had been halted in early September. During the shutdown, significant progress was made in the maintenance and integrity recovery campaign of the production units in Papa-Terra, allowing planning for better use of the reservoir with the future expansion of its production.
Atlanta
On 30 December, Brava announced that it had received authorization from ANP to commence production at FPSO Atlanta. Production at FPSO Atlanta has begun through two wells, starting 31 December. The connection campaign for the four remaining wells continues and is expected to be completed by the second quarter of 2025. The FPSO Atlanta has the capacity to produce up to 50,000 barrels of oil per day, treat 140,000 barrels of water per day and store up to 1.6 million barrels of oil.
Parque das Conchas
After meeting all precedent conditions and with the approval of ANP, Brava announced the conclusion of its acquisition of QatarEnergy Brasil Ltda’s 23% stake in the Abalone, Ostra and Argonauta oil fields, which form the Parque das Conchas Cluster in the Campos Basin. Parque das Conchas is operated by Shell, which holds a 50% stake, and ONGC is a partner in the asset with the remaining 27%. In the period between January and November 2024, the average production was approximately 27,000 boepd, with 6,200 boepd corresponding to the stake acquired by Brava.
One may subscribe to announcements on material facts from Brava through the Brava website.
Formal discussions on PetroUrdaneta’s re-development plan launched
Maha Energy AB (publ) (“Maha” or the “Company”) is pleased to announce that formal discussions on technical and operational agreements (“Mesas Técnicas”) between PetroUrdaneta, Maha (potential Partner B), and CVP (Partner A, a PDVSA subsidiary) have commenced to reach a mutual understanding and agreement on the re-development plan for the PetroUrdaneta fields in Venezuela. A kick-off meeting took place in December 2024, with the goal of concluding these discussions by the end of the first half of 2025.
During the Mesas Técnicas, topics to be discussed include infrastructure needs, suitable wells for redevelopment, production techniques and capital and operational expenditure estimates. The re-development plan will also serve as the foundation for forming a project team and determining social, environmental and personnel requirements.
“I am very pleased with this new important step in our establishment in Venezuela. Soon, we will have a clear roadmap for our future operations in the country. I look forward to sharing more details about the development plan as it progresses,” says Kjetil Solbraekke, CEO of Maha Energy.
The acquisition of indirect equity interest in the Venezuelan oil company PetroUrdaneta from Novonor Latinvest Energy continues to remain subject to certain milestones.
Maha continues to closely monitor the political developments in Venezuela, as well as liaising with the relevant stakeholders. As with all of its engagements, with respect to its activities involving Venezuela and PetroUrdaneta, Maha remains committed to compliance with all applicable laws and regulations, robust due diligence and transparency in its activities. This includes discussions and/ or request for licenses from relevant authorities.
Maha Energy’s Nomination Committee for the AGM 2025
Maha Energy AB (publ) (“Maha” or the “Company”) is pleased to announce the composition of the Nomination Committee for the 2025 Annual General Meeting (“AGM”) to be held on 27 May 2025 in Stockholm.
The Nomination Committee’s members are:
Rodrigo Pires, representing Turmalina Fundo de Investimento em Participações Multiestratégia
Luis Araujo, representing DBO Invest S.A.
Carlos Mello, representing Brasil Capital
Paulo Thiago Mendonça, chairman of Maha Energy AB
The tasks of the Nomination Committee shall be to prepare and submit to the AGM 2025 proposals in respect of:
- Number of members of the Board of Directors
- Remuneration to the Chairman of the Board of Directors, the other members of the Board of Directors and the auditors, respectively
- Remuneration, if any, for committee work
- The composition of the Board of Directors
- The Chairman of the Board of Directors
- Resolution regarding the process of the Nomination Committee 2026
- Chairman at the AGM
- Election of auditors
Shareholders who would like to submit proposals to the Nomination Committee can do so via e-mail to nomcom@maha-energy.com marked “Proposal to the Nomination Committee” or by ordinary mail to the address: Maha Energy AB, Nomination Committee, Eriksbergsgatan 10, 4tr, SE-114 30 Stockholm, Sweden.
To ensure that the proposals can be considered by the Nomination Committee, proposals shall be submitted in due time before the AGM 2025, but not later than February 28, 2025.
Report for the Nine months ended 30 September 2024
Highlights
(all amounts are in US dollars unless otherwise noted)
Third Quarter 2024
- Daily oil production from the Illinois Basin increased 54% to 276 BOEPD in Q3 2024 compared to Q3 2023, following the completion of the development program approved in Q3 2023.
- Revenue of MUSD 1.8 increased 44% in Q3 2024 compared to Q3 2023.
- Operating netback of MUSD 0.9 increased 71% in Q3 2024 compared to Q3 2023, mainly due to higher production.
- Completion of the transaction involving the roll up of Maha’s 15% shares in 3R Offshore to Brava Energia through sale of Maha’s wholly owned subsidiary Maha Energy (Holding) Brasil Ltda. in exchange for 10,081,840 common shares in Brava Energia. Adding these shares with Maha’s previous position of 12,019,184 shares of 3R Petroleum, Maha Energy ended up with a holding of 4.76% in Brava Energia.
- The price of Brava Energia shares was calculated as per closing documents to be BRL 29.78 per share, resulting in a total value of TUSD 53,021. The equity value of Maha Energy (Holding) Brasil Ltda. as of 31 of July 2024 was TUSD 35,078. The difference between the book value of the shares received and the equity value of the investment amounted to TUSD 17,943 and has been recognized as a capital gain under discontinued operations.
- Net loss of continuing operations MUSD 42.8, mainly impacted by an unrealized net loss of MUSD 40.6 from the market value of Brava Energia shares during the quarter.
- In September 2024, Maha’s potential acquisition of indirect interest in PetroUrdaneta was approved by the Venezuelan Oil Minister.
- Total cash balance of MUSD 25.7 (including restricted cash of MUSD 5.8).
- Liquid investments of MUSD 77.4, represented by Brava Energia shares and debentures issued by 3R Offshore.
- Buy-back program to repurchase up to 10% of Maha Energy’s outstanding shares launched. As of September 30, 2024, the Company repurchased 1,528,922 shares (0.86% of outstanding shares).
- In August 2024, Maha Energy decided to fully amortize its outstanding bank debt with BTG of TUSD 24,000 using cash collateral deposited in restricted cash accounts, resulting in approximately TUSD 600 of savings on interest for the next quarters.
- In August 2024, a new loan agreement was executed for MUSD 15, with a one-year term and an interest rate of 6.9% per annum, payable quarterly.
Subsequent Events
- In October 2024, approximately MUSD 4.5 held in the escrow account related to Maha Brazil Transaction was released in exchange for a bank guarantee.
- In November 2024, Maha repaid its bank debt of MUSD 15 to avoid granting additional cash collaterals resulting in a higher cost of debt.
Financial Summary
The tables below present the highlights of the continuing operations:
| Financial Summary (TUSD) | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 | Full Year 2023 |
| Average (BOEPD) | 276 | 179 | 311 | 207 | 197 |
| Revenue | 1,805 | 1,250 | 6,165 | 4,061 | 5,226 |
| Operating Netback | 902 | 527 | 3,192 | 1,645 | 2,197 |
| EBITDA | (1,586) | (661) | (1,719) | (2,134) | (3,900) |
| Net Result | (42,862) | (3,898) | (59,547) | (5,668) | (6,755) |
| Earnings per share (basic & diluted) | (0.25) | (0.02) | (0.35) | (0.04) | (0.03) |
| Financial Liabilities | (14,835) | (39,516) | (14,835) | (39,516) | (34,379) |
| Financial assets | 83,579 | 9,000 | 83,579 | 9,000 | 1,301 |
| Cash and cash equivalents (incl. restricted cash) | 25,673 | 140,006 | 25,673 | 140,006 | 131,076 |
Letter to Shareholders
Dear Friends and Fellow Shareholders,
We accomplished important milestones in the third quarter of 2024. In Brazil, Maha’s proposed consolidation in the Brazilian E&P industry was successful as the merger between 3R Petroleum and Enauta closed at end of July, now under the new name Brava Energia. The merger which was executed in just 6 months included the roll-up of Maha’s ownership in 3R Offshore, and Maha is now holding 4.76% in one of Latin America’s largest E&P companies.
The merged company has experienced some unexpected headwinds, including downtime and start-up delay in the two largest assets, and the Brava share price significantly decreased during September. We are however confident that production will resume and start ramping up before year-end of 2024. With more than 700 MMBOE in 2P reserves, and a fully invested production capacity of around 100,000 BOEPD the company will generate significant free cash flows going forward.
Deleverage and dividend capacity is what drove our investment in 3R and the merger with Enauta, and it continues to be our agenda as the largest industrial owner in Brava. Maha’s internal estimates, based on public information and a Brent price of USD 70 bbl, indicate that Brava over the next 3 years will have the capacity to pay dividends to Maha equal to our entire market capitalization.
In Venezuela we received the important approval from the Venezuelan Oil Minister to acquire PetroUrdaneta. In parallel we are working on the OFAC license from US, commercial offtake agreements and on the organizational and asset development plans. Our ambition is to launch production as soon as possible. Based on our preliminary technical analysis, we believe that production of PetroUrdaneta’s fields has potential to reach above 20,000 BOEPD within a few years.
In the Illinois Basin, we added three new production wells in September and saw production increase to around 400 BOPD by the end of the quarter. Going forward the asset will generate free cash flows supporting our G&A. The increasing Illinois production resulted in revenues of MUSD 1.8 and operating netback of MUSD 0.9, up 44% and 71%, respectively, from Q3 2023.
Following the roll-up of our offshore assets, we recorded an unrealized net profit in discontinued operations during the quarter of MUSD 18. However, the market value of the Brava share price resulted in an unrealized net loss of MUSD 40.5, which significantly impacted our net result for the period.
We have continued to adjust the balance sheet. In October, we released the vast majority of the remaining cash held in the escrow account and in November, we repaid in full the Company’s outstanding short-term bank loan. In effect, Maha is now a debt free company that stands strong and continues to be well equipped to fulfill our obligations and plans.
Kjetil Braaten Solbraekke (CEO)
Q3 Webcast 19 November at 14:00 CET
The Company invites all interested parties to a live webcasted presentation on 19 November at 14.00 CET. Kjetil Solbraekke, CEO, and Roberto Marchiori, CFO, will present the report and recent developments.
The webcast will be held in English and will be broadcasted live. An on-demand version will also be available on Maha’s website. Questions to the presenters can be emailed in advance to the Company at info@maha-energy.com or be made directly on the day of the presentation in the YouTube Comments/Questions field.
Link to webcast: https://youtube.com/live/D7tlDJ1eD5k?feature=share
Invitation to the presentation of Maha Energy’s Q3 2024
Maha Energy AB (publ) (“Maha” or the “Company”) will publish the interim report for the third quarter 2024 on Tuesday, 19 November 2024 at approximately 7:30 CET. The Company hereby invites all interested parties to a live webcasted presentation on the same day at 14.00 CET. Kjetil Solbraekke, CEO, and Roberto Marchiori, CFO, will present the report and recent developments.
The webcast will be held in English and will be broadcasted live. An on-demand version will also be available on Maha’s website. Questions to the presenters can be emailed in advance to the Company at info@maha-energy.com or be made directly on the day of the presentation in the YouTube Comments/Questions field.
Link to webcast: https://youtube.com/live/D7tlDJ1eD5k?feature=share
Maha’s acquisition of indirect interest in PetroUrdaneta has been approved by the Venezuelan Oil Minister
Maha Energy AB (publ) (“Maha” or the “Company”) is pleased to announce that another important step in the acquisition of indirect equity interest in the Venezuelan oil company PetroUrdaneta from Novonor Latinvest Energy (“Transaction”) has been achieved, with the approval by the Venezuelan Oil Minister of the proposed Change of Control of PetroUrdaneta’s Partner B (i.e., ODB Spain).
The consummation of the Transaction remains subject to certain milestones, including the successful negotiation of the relevant operational and collaboration agreements for the redevelopment of PetroUrdaneta’s fields.
"I am very pleased to have reached this important step in our process to start producing the vast resources of oil at the PetroUrdaneta fields. We remain very optimistic over our entry in Venezuela and continue our dialogue with the relevant stakeholders in order to address the remaining approvals and close the Transaction,” says Kjetil Solbraekke, CEO of Maha Energy.
Maha continues to closely monitor the political development in Venezuela, as well as liaising with the relevant stakeholders with diligence and transparency for the purposes of starting its activities in PetroUrdaneta, including by means of any applicable alignments and/ or license from relevant authorities.
Share buy-backs in Maha Energy during the period 16-18 September 2024
During the period 16-18 September 2024 , Maha Energy AB (publ) ("Maha Energy" or the "Company") has repurchased a total of 142,922 own shares as part of the share buy-back program that was announced on 12 August 2024.
The share buy-backs form part of the share buy-back program of a maximum of 17,844,475 own ordinary shares that the Board of Directors of Maha Energy resolved on 12 August 2024 based on the authorization granted by the annual general meeting on 29 May 2024.
Maha Energy shares have been repurchased during the period 16-18 September 2024 as follows:
| Date | Aggregated daily volume (number of shares): | Weighted average share price per day (SEK): | Total daily transaction value (SEK): |
| 2024-09-16 | 65,000 | 7.8986 | 513,410 |
| 2024-09-17 | 55,000 | 7.7831 | 428,072 |
| 2024-09-18 | 22,922 | 7.6498 | 175,348 |
All share buy-backs have been carried out on Nasdaq Stockholm by Pareto Securities on behalf of Maha Energy. Following the acquisitions detailed above, the Company's total holdings of own shares as of 18 September 2024 amounts to 1,528,922 shares. The total number of shares in Maha Energy amounts to 178,444,753.
A full breakdown of the transactions is attached to this announcement.
For the complete repurchase authorization, resolved by the shareholders at the AGM 2024, and the press release regarding the board of director’s resolution to initiate the share buy-back program, please refer to Maha Energy's website, www.maha-energy.com.
Share buy-backs in Maha Energy during the period 9-13 September 2024
During the period 9-13 September 2024 , Maha Energy AB (publ) ("Maha Energy" or the "Company") has repurchased a total of 281,500 own shares as part of the share buy-back program that was announced on 12 August 2024.
The share buy-backs form part of the share buy-back program of a maximum of 17,844,475 own ordinary shares that the Board of Directors of Maha Energy resolved on 12 August 2024 based on the authorization granted by the annual general meeting on 29 May 2024.
Maha Energy shares have been repurchased during the period 9-13 September 2024 as follows:
| Date | Aggregated daily volume (number of shares): | Weighted average share price per day (SEK): | Total daily transaction value (SEK): |
| 2024-09-09 | 70,000 | 7.6634 | 536,441 |
| 2024-09-10 | 71,000 | 7.5072 | 533,009 |
| 2024-09-11 | 40,000 | 7.5470 | 301,882 |
| 2024-09-12 | 35,000 | 7.6513 | 267,794 |
| 2024-09-13 | 65,500 | 7.8949 | 517,116 |
All share buy-backs have been carried out on Nasdaq Stockholm by Pareto Securities on behalf of Maha Energy. Following the acquisitions detailed above, the Company's total holdings of own shares as of 13 September 2024 amounts to 1,386,000 shares. The total number of shares in Maha Energy amounts to 178,444,753.
A full breakdown of the transactions is attached to this announcement.
For the complete repurchase authorization, resolved by the shareholders at the AGM 2024, and the press release regarding the board of director’s resolution to initiate the share buy-back program, please refer to Maha Energy's website, www.maha-energy.com.