Daily Independent (Lagos)
5 January 2009
Oando Exploration and Production Limited (OEPL), the upstream arm of Oando PLC, has bought over 75 percent equity of Exile Resources' 40 percent working interest in Akepo Field in a bid to enlarge its upstream oil assets in Nigeria.
Akepo Field is within oil mining lease (OML) 90 offshore in the South Eastern part of Nigeria. Originally a joint venture agreement between NNPC and Chevron, the marginal field was awarded to Sonegal during the 2003 Marginal Oil Fields Allocation Rounds in 2003 by the DPR.
OEPL, a subsidiary of Oando PLC, Nigeria's leading integrated energy solutions provider, is currently operator of two oil blocks - oil production licenses (OPLs) 278 and 236.
Exile Resources Inc., a Toronto-based oil and gas exploration company, advancing the development of Akepo oilfield in the shallow waters of the Niger Delta, is also pursuing additional oil and gas, exploration and development opportunities in Africa.
Under the terms of the two-stage structure of the Financial and Technical Services Agreement signed last October, Oando is expected to re-imburse Exile's past financial investments on the development of Akepo field as well as fund the development of the project in return for 75 percent of Exile's current economic interest in the project.
The arrangement will see Oando own 30 percent equity stake in the Akepo project, subject to the approval of the relevant authorities, including the Nigerian National Petroleum Corporation (NNPC), Department of Petroleum Resources (DPR) and Sogenal Limited, the Operator of the field.
Details of the agreement indicate that Oando will fully recover all of its costs, earning an economic interest of 72 percent from first oil, while its interest will drop to 52.5 percent up to cumulative production of 7.5 million barrels of oil from the field after recovering costs.
Consequently, Oando will earn 37.5 percent economic interest until 10 million barrels of oil have been recovered from the field and 30 percent thereafter.
Chief Executive Officer, OEPL, Tunde Ogunnaike, expressed the excitement of its management about the acquisition, saying it is in line with the company's plans to boost its portfolio with near term oil and gas assets.
"As the technical and management partners, we will be conducting immediately, additional technical studies to facilitate the drilling of more wells to fast track the development of this block," Ogunnaike said.
President/Chief Executive Officer, Exile Resources, Tony Henshaw, who commended the partnership between Oando, Sogenal and his company in the development of Akepo Project, noted: "In the current uncertain financial climate, Oando's financial strength and capability, and experience in the Nigerian oil sector will enable the Project move forward to first oil production in the earliest timeframe, and Exile looks forward to working with Oando and Sogenal in the future on other projects in Nigeria".
OEPL, which is a Local Content Vehicle (LCV) partner with Nigeria Agip Oil Company (NAOC) on OPL 282, has a 45 percent non-operating participatory interest in the Obodeti-Obodugwa marginal field, (formerly OML 56), with both fields at different stages of development to significantly increase Nigeria's oil and gas production capacity and reserves.
Be the first to Write a Comment!
Copyright © 2009 Daily Independent. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.
AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.
