Oando Energy Resources, OER, an affiliate company of Oando Plc, focused on oil exploration and production in Nigeria, has expressed confidence in concluding the acquisition of the Nigerian oil and gas business of ConocoPhillips, COP.
OER had paid COP an initial deposit of $435 million deposit, and the net purchase price payable to complete the acquisition of the remaining assets associated with the COP Acquisition is estimated to be approximately $1.22 billion.
To conclude the deal, OER has also received commitment letters for up to $815 million of bank credit facilities, with $465 million drawn from Reserve Based Lending Facility, internationally placed and led by BNP Paribas, Standard Bank, and Standard Chartered Bank; and a $350 million Senior Secured Loan, jointly arranged locally in Nigeria, by FBN Capital and FCMB Capital Markets.
“Maximising value for our shareholders is our ultimate goal, and through optimal financing we remain determined to conclude the COP Acquisition as soon as possible and increase our market share and infrastructure within the sector,” said Pade Durotoye, CEO of Oando Energy Resources. Once the deal is concluded, OER’s daily production will substantially increase from 4,500 bpd to 45,000 bpd, and will place the company as the largest indigenous producer behind the International Oil Companies (IOCs).
The acquisition also paves the way for other indigenous companies to address operational boundaries within Nigeria and position themselves as global players, thus providing unprecedented opportunities for local and international investors to invest in Nigeria. Last month, the company disclosed that it has received commitment letters for up to $815 million of bank credit facilities which will be largely applied towards payment of the purchase price in respect of its proposed acquisition of ConocoPhillips’ Nigerian upstream oil and gas business.
[Udeme Akpan, National Mirror]