Meren Energy CEO Talks Of Solid Investor Returns

The Egina Floating Production Storage and Offloading installation in Nigeria.

Meren Energy, October 2025

Independent oil and gas company Meren Energy (TSX: MER, OTCMKTS: AOIFF) has a new name, ownership structure and strategy, but an old objective of delivering solid investor returns that will never change, according to its boss.

The Toronto-listed company changed its name to Meren Energy from Africa Oil in May, and for chief executive officer Roger Tucker it is all linked to a “wider evolution” focused on providing value for its investors.

“Historically, as Africa Oil, we had an interesting portfolio of assets including holdings in small-scale explorers. But they were held in a very complex ownership structure. It was almost as if we were a fund manager with energy assets under management. This quite frankly made a company like ours with good cashflow and yielding assets a bit difficult to understand,” Tucker said in an exclusive interview.

Therefore, in the CEO’s own words, a spot of “strategic housekeeping” was necessary to streamline the portfolio. Tucker took over the CEO’s chair two years ago to do precisely that.

The biggest of these changes came about in March, when the company completed the consolidation of Prime Oil & Gas, acquiring Brazilian finance and investment house BTG Pactual’s remaining stake to gain 100% ownership of it.

“We believe the move significantly increased our reserves and production from high-quality Nigerian offshore assets, helped implement a new dividend policy targeting $100 million annually, and set us on a better value creation path for investors.”

And as part of the transformation BTG Pactual then took a 35% stake in the consolidated company, bringing its domain expertise of investing in resource rich Latin America to the partnership.

Name Of The Game

The entry of BTG Pactual as its largest shareholder gave the company a broader geographical mandate to look at global opportunities, even if Africa remains the focus. “But imagine going to Latin America to do deals and you have ‘Africa’ in your entity’s name. The consolidation and wider ambition of not being constrained by geography made rebranding necessary,” Tucker said.

“However, for us, it wasn’t just about changing a name. We wanted to actually find something sufficiently differential and narrowed in on the name Meren. Its an old Dutch nautical term representing the mooring of a vessel as it docks and anchors in new worlds.”

The original intention was to call the company “MerEn” with the “En” signifying energy but some Canadians had other ideas, Tucker joked.

“The Toronto Stock Exchange needs company names to effectively offer a steer on what the company actually does. We tried to argue that “En” in MerEn was signifying energy but they didn’t accept it. So, Meren Energy Inc is what we are and what we intend to literally go places with.”

To Africa And Beyond

Tucker said the recently rebranded Meren Energy is now moving away from being exploration-led under his predecessor Keith Hill to being a full-cycle exploration and production company.

“Our primary assets remain the same, i.e. three FPSOs [“Floating Production Storage and Offloading” installations] Akpo, Egina and Agbami in Nigeria. Two are operated by TotalEnergies as our joint venture partner and one by Chevron.”

They have significant upside and underpin the financial stability of Meren Energy, just as it seeks new opportunities in South Africa and Namibia – the promising Orange Basin.

Tucker insisted that while the energy world is busy navel gazing at Namibia, and admitted the “economic transformation” of that economy via a hydrocarbon windfall was only a matter of time, South Africa may well turn out to be “as big an opportunity” if not bigger.

“Our interest is in South Africa’s block 3B/4B. If you looked at the prospection area as a whole, the Orange Basin acreage is much larger in percentage terms in South Africa compared to Namibia. To me that’s a potentially bigger play. Overall, we are probably more exposed than any other independent in this promising space,” observed the Meren Energy CEO, who has a doctorate in geology and decades of experience in multiple markets from Brazil to Russia.

The industry veteran is also busy guiding his company’s exploratory presence in Equatorial Guinea. “As we walk up and down West Africa, Equatorial Guinea has its own unique risk profile.

“We are in talks with partners to attract farm-in parties on two blocks in the country. The current target is to complete the active data room part of the exercise by the end of this year. Its early days, and there’s no guarantee we can secure farm-in partners on terms we find acceptable. If we do, we will push for rapid drilling.”

Market commentators also notice a deep partnership between Meren Energy and TotalEnergies in multiple geographies. But Tucker described this as “happenstance,” albeit a collaboration that is getting stronger with both parties cognizant of each others’ operating priorities.

What perhaps wasn’t happenstance was summer market chatter of a merger with Tullow Oil, a smaller London-listed and Africa-focused industry peer in terms of market valuation. Its market valuation of $215 million is nearly a fourth of Meren Energy’s $900 million-plus valuation but talks collapsed in June.

Tullow Oil declined comment, while Tucker simply noted: “I won’t speak to the specifics. We remain interested in the right asset at the right price. However, I will say that our current focus is on organic growth.”

Keeping The Returns Solid

In its latest financials for its fiscal second quarter published in August, Meren Energy announced an average daily working interest and entitlement production of 30,900 barrels of oil equivalent per day (boepd) and 35,700 boepd respectively. This was in line with market expectations.

The company also reduced its reserve-based lending – a structure for oil and gas finance where loans are secured by the value of the company’s estimated hydrocarbon reserves – by $80 million, at the end the quarter, thereby lowering interest charges and bringing the debt pile down to $540 million.

But a cash balance of $266.6 million meant a much lower net debt position of $273.4 million. Being in a healthy financial position also went a long way toward declaring a total third quarter divided of approximately $25 million (or $0.0371 per share), bringing total distributions year-to-date to approximately $75.1 million.

“This keeps us on track for a $100 million distribution to shareholders this year which was discussed at the time of the consolidation in March. We’ve also paid down a significant amount of debt. There is a constant review by us about getting the shareholder returns policy exactly right, not necessarily only the amount, but the shape in which we deliver those returns.

“We remain totally committed to the $100 million figure at the moment but we may look at structuring it in a slightly different way. Shareholder returns will always be at the forefront of our minds as Meren Energy embarks on a bold new phase.”