Oando Makes Major Move In Nigerian Energy Sector


Oando, a prominent Nigerian energy company, has inked a significant agreement with Eni, an Italian energy giant, to acquire the entirety of Nigerian Agip Oil Company Limited (NAOC Ltd).

The finalisation of this deal hinges on securing ministerial consent and the essential green light from regulatory bodies; as stated by Ayotola Jagun, Oando’s corporate secretary, in an official announcement released on Monday. The press release was promptly disseminated to both the Nigerian Exchange Limited and the Johannesburg Stock Exchange; where Oando holds a listing.

This AGIP acquisition marks a very important moment for Oando; effectively doubling its existing interest in OMLs 60, 61, 62, and 63; elevating it from 20% to 40%. This acquisition also consolidates Oando’s ownership in the NEPL/NAOC/OOL Joint Venture’s assets and infrastructure, which encompass an impressive array of forty oil and gas fields, twenty-four of which are presently in active production. The deal further encompasses approximately forty identified prospects and leads.

Among the assets included in the acquisition are a dozen production stations, an expansive network of pipelines covering roughly 1,490 kilometers, three gas processing facilities, the Brass River Oil Terminal, as well as the Kwale-Okpai phases 1 & 2 power plants, boasting an impressive total nameplate capacity of 960 megawatts, in addition to associated infrastructure.

In terms of proven reserves, based on estimates from 2021, this deal will catapult Oando’s total reserves to an astonishing 503.3 million barrels of oil equivalent (MMboe); reflecting a remarkable 98% surge post-transaction. Notably, this strategic move also bolsters Oando’s exploration assets; securing a 90% interest in OPL 282 and a 48% stake in OPL 135.

However, it is crucial to highlight that NAOC Ltd’s participation in the SPDC JV (Shell Production Development Company Joint Venture) remains outside the purview of this transaction and will continue to be part of Eni’s portfolio, per Jagun’s statement.

Wale Tinubu, Oando Plc’s Group Chief Executive, expressed his enthusiasm for the transformative potential of this acquisition. He foresees increased production, enhanced efficiency, and more effective resource allocation. Tinubu underscored the pivotal role that indigenous enterprises play in Nigeria’s upstream sector and expressed eagerness to generate value for local communities, stakeholders, and shareholders.

Eni officially confirmed the agreement with Oando Plc for the sale of Nigerian Agip Oil Company Ltd (NAOC Ltd) on the company’s website; focusing on onshore oil & gas exploration, production in Nigeria, and power generation. Eni emphasized its steadfast commitment to the welfare, safety, and environmental considerations of its employees in Nigeria; maintaining its presence through Nigerian Agip Exploration (NAE) and Agip Energy and Natural Resources (AENR), with a strategic focus on offshore operations. Eni’s commitment extends to continued participation in operated-by-others assets, both onshore and offshore, as well as Nigeria LNG.

This strategic move aligns seamlessly with Eni’s 2023-2026 Plan, marking a strategic shift towards a more high-value, growth-oriented portfolio. The finalisation of this transaction remains contingent upon obtaining the requisite approvals from local and regulatory authorities.

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