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.
