Eni has finalized the divestment of its onshore oil and fuel exploration and manufacturing subsidiary in Nigeria to native participant Oando PLC for practically $800 million.
The sale of Niger Delta-focused Nigerian Agip Oil Co. Ltd. (NAOC), introduced September 4, 2023, comes amid an onshore exodus from the oil theft-plagued area within the south of the West African nation.
“Eni will proceed to be current within the nation by means of funding in deepwater initiatives and Nigeria LNG, whereas additionally exploring new alternatives associated to agri-feedstock sector”, the Italian government-controlled power main stated in a latest assertion on its web site saying the closure.
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NAOC operates Oil Mining Licenses (OMLs) 60, 61, 62 and 63 within the Niger Delta by means of the NAOC three way partnership with Oando and nationwide oil and fuel firm Nigeria Nationwide Petroleum Co. Ltd. (NNPC). NAOC and Oando maintain a 20 p.c stake every within the three way partnership whereas the remaining 60 p.c is beneath NNPC E&P Ltd. Oando has now raised its stake within the 4 licenses to 40 p.c.
The transaction has additionally elevated Oando’s reserve estimates by 98 p.c from 493.6 million barrels of oil equal in 2022 to 1 billion barrels of oil equal, Oando stated individually. NAOC had a contribution of 40,000 barrels of oil equal per day to Eni’s manufacturing, in line with an Eni replace of the transaction July 24, 2024.
The NAOC three way partnership portion of Oando’s acquisition included “forty found oil and fuel fields, of which twenty-four are presently producing, roughly forty recognized prospects and leads, twelve manufacturing stations, roughly 1,490 km [925.8 miles] of pipelines, three fuel processing vegetation, the Brass River Oil Terminal, the Kwale-Okpai phases 1 & 2 energy vegetation (with a complete nameplate capability of 960 megawatts), and related infrastructure”, Oando stated.
The sale additionally included NAOC’s 48 p.c and 90 p.c working pursuits in exploration leases 135 and 282 respectively.
The transaction amounted to $783 million, Oando stated. That’s largely funded by debt; the African Export-Import Financial institution (Afreximbank) introduced Friday a senior $500-million and junior $150-million credit score facility, in partnership with two different lenders however largely involving Afreximbank, to assist Oando with the acquisition.
“It’s a win for Oando, and each indigenous power participant, as we take our future in our fingers, and play a pivotal function on this subsequent section of the nation’s upstream evolution”, Oando chief govt Wale Tinubu stated after the completion of the acquisition.
The transaction didn’t embrace NAOC’s 5 p.c stake within the Niger Delta-focused Shell Petroleum Growth Co. Joint Enterprise (SPDC JV).
Britain’s Shell PLC holds operatorship of the three way partnership with a 30 p.c stake. Nonetheless it has entered an settlement to switch its stake to Renaissance Africa Power Co. Ltd. for as much as $2.4 billion plus potential contingent funds. NNPC is almost all proprietor with 55 p.c. France’s TotalEnergies SE has the remaining 10 p.c, although additionally it is promoting its curiosity to Nigerian-owned Chappal Energies Mauritius Ltd. for $860 million.
The SPDC JV, which has suffered oil spills and theft, holds 15 onshore leases that produce primarily oil. Three different SPDC JV licenses in shallow waters — OML 23, 28 and 77 — produce primarily fuel, accounting for 40 p.c of the West African nation’s liquefied pure fuel (LNG) provide, in line with TotalEnergies’ announcement of the sale to Chappal Energies July 17.
In Nigeria, the place Eni entered 1962, the corporate had a mean annual manufacturing of 11 million barrels of oil and condensate and 63 billion cubic toes of pure fuel earlier than the divestment, in line with data on Eni’s web site.
Eni additionally holds a ten.4 p.c stake in Nigeria LNG Ltd. (NLNG), which, in line with figures on NLNG’s web site, produces 22 million metric tons each year (MMtpa) of LNG and 5 MMtpa of pure fuel liquids.
Offshore Refocus
Eni stated the divestment to Oando permits it to concentrate on its operated offshore property in Nigeria. Nonetheless, as with Eni’s stake within the SPDC JV, the corporate has determined to retain onshore property by which it holds non-operating stakes.
Shell and TotalEnergies had additionally stated their exit from the SPDC JV would permit them to concentrate on offshore property in Nigeria.
Shell built-in fuel and upstream director Zoë Yujnovich stated January 16 within the firm’s announcement of the divestment to Renaissance, “This settlement marks an essential milestone for Shell in Nigeria, aligning with our beforehand introduced intent to exit onshore oil manufacturing within the Niger Delta, simplifying our portfolio and focusing future disciplined funding in Nigeria on our Deepwater and Built-in Gasoline positions”.
Nicolas Terraz, president for exploration and manufacturing at TotalEnergies, stated July 17 in a press launch in regards to the sale to Chappal Energies, “TotalEnergies continues to actively handle its portfolio in Nigeria, in keeping with its technique to concentrate on its oil offshore and fuel property”.
Exxon Mobil Corp. has additionally entered an settlement to promote its fairness stake in Mobil Producing Nigeria Limitless to native participant Seplat Power PLC, as introduced by america firm February 25, 2022. Mobil Producing Nigeria holds a 40 p.c stake in 4 OMLs together with over 90 shallow-water and onshore platforms and 300 producing wells, ExxonMobil stated then.
To contact the creator, e-mail jov.onsat@rigzone.com
