Oando Plc (NGX: OANDO) has completed the $783 million acquisition of Nigerian Agip Oil Company (NAOC), a unit of Italy’s oil supermajor Eni.
Oando disclosed this on Thursday in a regulatory filing on the Nigerian Exchange, barely eleven months after it struck a deal to buy the asset.
According to the oil driller, the transaction, “comprised of consideration for the asset and reimbursement.”
Oando noted that the acquisition is a “milestone” in its long-term strategy to scale its upstream operations and beef up its position in the Nigerian oil & gas industry.
The 100% acquisition of Eni’s shares in NAOC by Oando was approved by the Nigerian Upstream Petroleum Regulatory CCommission in July.
The purchase lifts the company’s stakes in oil mining leases (OMLs) 60, 61, 62 and 63 to 40 per cent from 20 per cent.
“It increases Oando’s ownership stake in all NEPL/NAOC/OOL joint venture assets and infrastructure which include forty discovered oil fandango gas fields, of which twenty-four are currently producing, approximately forty identified prospects and leads, twelve production stations, 1,490 km of pipelines,” the statement said.
The energy company will also take ownership of three gas-processing plants, the Brass River Oil Terminal, the Kwale-Okpai phases 1&2 power plants (with a total nameplate capacity of 960MW) and associated infrastructure.
The acquisition will also increase Oando’s 2022 reserve estimates by 98% from 505.6MMboe, to 1.0Bnboe.
The company stated that the transaction would boost its cash flows considerably.
“It is a win for Oando and every indigenous energy player, as we take our destiny in our hands and play a pivotal role in this next phase of the nation’s upstream evolution,” said Wale Tinubu, Oando’s CEO.
“With our assumption of the role of operator, our immediate focus is on optimising the assets’ immense potential, advancing production, and contributing to our strategic objectives,” he added.
The deal excludes Eni’s 5 per cent participating interest in SPDC (Shell Production Development Company Joint Venture), Eni said in a website statement.
The Italian oil firm noted it would continue to operate in Nigeria via investment in deep-water projects and Nigeria LNG while exploring fresh opportunities related to the agri-feedstock sector.
On Thursday, Oando shares rose 9.99%, its maximum possible daily gain on the Nigerian Exchange, to close at N43.5 per share. In the last one month, Oando has soared 147.2% as it closed at N17.6 on 22nd July, 2024.
YTD, it has risen over 300%.
Ifunanya Ikueze is an Engineer, Safety Professional, Writer, Investor, Entrepreneur and Educator.
