TheCable

African Export-Import Bank (Afreximbank), a pan-African multilateral trade finance institution, has announced the disbursement of  $250 million of the $1.1 billion, to support the acquisition of a 45 per cent stake in OML 17 onshore oil field, by Tony Elumelu’s Trans Niger Oil and Gas Limited (TNOG).

Afreximbank, in a statement issued on Thursday, said with the $250million reserve based lending facility, it was the largest lender, underwriting about a quarter of the financing that enabled TNOG to buy stakes in OML 17 from Shell Petroleum Development Company, Total E&P Nigeria Limited and ENI.

Other participating lenders include Africa Finance Corporation, Union Bank, Shell, Hybrid Capital and Schlumberger, with TNOG advised by United Capital Plc.

Following this acquisition, TNOG will now operate the OML 17 onshore oilfield on behalf of the Nigerian National Petroleum Corporation (NNPC), which owns the remaining 55 per cent working interest.

The five-year $1.1 billion facility, which was signed in December 2020, was led, as Mandated Lead Arrangers, by Afreximbank, Standard Chartered Bank and ABSA.

Tony Elumelu, chairman of Heirs Holdings, said the transaction is a testament to the opportunity in Nigeria, noting that the acquisition of OML 17 and important related assets, significantly advances Heirs Holdings’ strategic vision of creating Africa’s leading integrated energy company.

“We are building a business that will ensure that African natural resources drive African power networks and ensure value creation occurs in Africa. I would like to take the opportunity to thank Afreximbank, and President Oramah for their strong support and shared vision of the transaction.”

Benedict Oramah, president of Afreximbank, said the transaction further underscores the bank’s commitment to ensuring that indigenous African companies are able to play a more dominant role in the operations of specialized oil and gas assets in an industry hitherto dominated by the international oil companies (IOCs).

“TNOG as the Operator of OML 17 will invest in an accelerated production ramp up thereby boosting foreign exchange earnings and employing more Africans. This resonates with our mandate. We congratulate Heirs Holdings for keeping the Africa flag flying.”

The OML 17 has a production capacity of 27,000 barrels of oil equivalent per day.

There are estimated 2P reserves (proven and probable) of 1.2 billion barrels and an additional one billion barrels in possible reserves — all of oil equivalent.