African Export-Import Bank, Afreximbank, has announced that it provided a $650 million lending facility to Oando Plc as part of the $783 million acquisition of Nigerian Agip Oil Company (NAOC).
The bank made this announcement on its official website on Friday, adding that the loan included both senior and junior reserved-based lending facility.
Recall that Nairametrics reported on Thursday that Oando Plc completed the acquisition of NAOC for the sum of $783 million from Italian oil major Eni.
Accordingly, the deal was partly facilitated by Afreximbank with a senior credit facility of $500 million and a junior reserve-based lending facility of $150 million.
“African Export-Import Bank (Afreximbank) has successfully arranged a senior US$500-million and a junior US$150-million reserve-based lending facility for Oando Petroleum and Natural Gas Company Limited. The facility was used to finance Oando’s acquisition of the 20 per cent participating interest held by Nigerian Agip Oil Company Limited (NAOC) in the NEPL/NAOC/Oando Joint Venture in Nigeria.
“The joint venture, with significant oil and gas assets, including oil mining licenses 60, 61, 62 and 63, has produced 4.4 billion barrels of oil and 12 trillion cubic feet of natural gas to date, with 1.2 billion barrels of oil and 10.7 trillion cubic feet of natural gas remaining,” the bank said.
More Insights
In addition, the bank announced that it was retained as the mandated lead arranger for Oando’s transaction.
It also served in multiple roles, including bookrunner, coordinator, underwriter, escrow agent, facility agent, and security trustee.
It said It also participated in and underwrote $350 million of the facility.
Haytham Elmaayergi, Executive Vice President of Global Trade at Afreximbank, remarked that the facility represents a significant milestone in the Bank’s efforts to enhance local content within Africa’s oil and gas sector.
“By supporting the acquisition of key energy assets by an indigenous company like Oando, the Bank is fostering economic empowerment, enhancing regional trade, and contributing to the sustainable development of Africa’s natural resources,” he said.
On his part, Wale Tinubu, CON, Group Chief Executive of OANDO, expressed that the announcement is the culmination of a decade of hard work, perseverance, and a strong belief in realizing the company’s ambition, which began with their 2014 entry into the Joint Venture through the acquisition of ConocoPhillips Nigerian Portfolio.
“We thank Afreximbank for its unwavering leadership in bridging the trade finance gap in Africa and ensuring that Oando can consolidate its stake in the Joint Venture via the acquisition of NAOC’s 20% stake,” Tinubu added.
What you should know
Nairametrics previously reported that Oando PLC successfully acquired the Nigerian Agip Oil Company (NAOC) from the Italian energy conglomerate Eni for a total of $783 million.
This acquisition is poised to strengthen Oando’s position in Nigeria’s oil and gas sector by expanding its operational footprint and enhancing its upstream capabilities.
As a result of the deal, Oando’s participating interest in Oil Mining Leases (OMLs) 60, 61, 62, and 63 has increased from 20% to 40%.
This expansion broadens Oando’s ownership across all NEPL/NAOC/OOL Joint Venture assets, which include 40 discovered oil and gas fields, 24 of which are currently producing.
Additionally, Oando now holds stakes in key infrastructure assets, including approximately 1,490 kilometres of pipelines, three gas processing plants, the Brass River Oil Terminal, and the KwaleOkpai power plants with a combined capacity of 960 MW.
