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Friday, January 15, 2021 /09:05
PM / by NSE/ Header Image Credit: tnog.heirsholdings.com
Heirs Holdings (HH), the core investor in
Transnational Corporation of Nigeria Plc ("Transcorp") Significantly Expands
Oil and Gas Portfolio
- Acquires 45% of OML 17 from Shell,
Total and ENI
- Existing Production Capacity of 27,000
barrels of oil equivalent per day Estimated 2P Reserves of 1.2 billion barrels
of oil equivalent
- Estimated Additional 1 billion barrels
of oil equivalent of further exploration potential
Heirs Holdings ("HH"), the leading African strategic
investor, in partnership with affiliated company Transnational Corporation of
Nigeria Plc ("Transcorp"), Nigeria's largest publicly listed conglomerate,
announced today the unconditional acquisition of a 45% participating interest
in Nigerian oil licence OML 17 and related assets, through TNOG Oil and Gas
Limited (a related company of Heirs Holdings and Transcorp), from the Shell
Petroleum Development Company of Nigeria Limited, Total E&P Nigeria Limited
and ENI. In addition, TNOG Oil and Gas Limited will have sole operatorship of
the asset.
The transaction is one of the largest oil and gas
financings in Africa in more than a decade, with a financing component of
US$1.1 billion, provided by a consortium of global and regional banks and
investors. OML 17 has a current production capacity of 27,000 barrels of oil
equivalent per day and, according to our estimates, 2P reserves of 1.2 billion
barrels of oil equivalent, with an additional 1 billion barrels of oil
equivalent resources of further exploration potential.
The investment demonstrates a further important
advance in the execution of Heirs Holdings' integrated energy strategy and the
Group's commitment to Africa's development, through long term investments that
create economic prosperity and social wealth. Heirs Holdings' heritage and
approach to business fundamentally underscores its commitment to inclusive
development and shared prosperity with its host communities. Heirs Holdings is
fully invested in the development of the Niger Delta region.
Heirs Holdings' strategy of creating the leading
integrated energy business in Africa is executed through a series of strategic
portfolio holdings. Transcorp is one of the largest power producers in Nigeria,
with 2,000 MW of installed capacity, through ownership of Transcorp Power Plant
and the recent acquisition of Afam Power Plc and Afam Three Fast Power Limited.
Transcorp closed the US$300 million Afam acquisitions in November 2020.
Transcorp supplies electricity to the Republic of Benin, as part of an emphasis
on promoting regional integration and delivering robust power supply to
catalyse development in Africa. Transcorp also operates OPL281, under a
production sharing contract with the Nigerian National Petroleum Corporation
("NNPC"). Similarly, Heirs Holdings' subsidiary, Tenoil is the operator of OPL
2008, under a production sharing contract with NNPC. Tenoil also owns the Ata
Marginal Field, which will commence production in Q2, 2021, with 3,500 barrels
of oil per day.
Chairman of Heirs Holdings, Tony Elumelu stated: "We
have a very clear vision: creating Africa's first integrated energy
multinational, a global quality business, uniquely focused on Africa and
Africa's energy needs. The acquisition of such a high-quality asset, with
significant potential for further growth, is a strong statement of our
confidence in Nigeria, the Nigerian oil and gas sector and a tribute to the
extremely high-quality management team that we have assembled. As a Nigerian,
and more particularly an indigene of the Niger Delta region, I understand well
our responsibilities that come with stewardship of the asset, our engagement
with communities and the strategic importance of the oil and gas sector in
Nigeria. We see significant benefits from integrating our production, with our
ability to power Nigeria, through Transcorp, and deliver value across the
energy value chain."
Speaking further, he said "I would like to thank
Shell, Total and ENI, for the professionalism of the process, the Federal
Government of Nigeria, the Ministry of Petroleum Resources, and the NNPC for
the confidence they have placed in us."
Speaking on the investment, the President/GCEO of
Transcorp, Owen Omogiafo, said "This deal further demonstrates Transcorp's
integrated energy strategy and our determination to power Africa."
Heirs Holdings was advised by Standard Chartered Plc,
as Global Coordinator, and United Capital Plc, with a syndicate of lending
institutions including Afreximbank, ABSA, Africa Finance Corporation, Union
Bank of Nigeria, Hybrid Capital, and global asset management firm Amundi. The
deal also involves Schlumberger as a technical partner, as well as the trading
arm of Shell as an offtaker.
Heirs Holdings has created one of Africa's largest,
indigenous owned, oil and gas businesses, headquartered in Lagos, Nigeria and
led by a board and management team with significant regional and global
experience in production, exploration, and value creation in the resources
sector. The HH Group is committed to the highest standards of safety, health,
and community relations, together with best practice in governance and
accountability.
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