Oando acquires ConocoPhillips Nigerian oil and gas business for $1.5bn
Nigeria-focused oil and gas explorer Oando Energy Resources (OER) on Wednesday announced that it had completed the acquisition of the Nigerian upstream oil and gas business of New York-listed ConocoPhillips for a total cash consideration of $1.5-billion as well as a deferred cash consideration of $33-million.
OER believed that the transaction represented a significant opportunity for the company to create scale and significant value for its shareholders, pointing out that the total reserves and resources associated with the transaction amounted to proved and probable reserves of 211.6-million barrels oil equivalent, with best estimate contingent resources of 498.6-million barrels oil equivalent and unrisked best prospective resources of 656.9-million barrels oil equivalent.
“This transaction represents a transformational leap forward for our company and is in line with our overall strategy to grow our portfolio of Nigeria-based assets by focusing on those opportunities that deliver high-quality growth in reserves and production,” OER CEO Pade Durotoye said.
He added that OER’s management team was familiar with the assets and possessed the managerial experience and technical expertise necessary to unlock their value.
Also commenting, OER chairperson Wale Tinubu stated that the company believed in the significant potential that the Nigerian oil and gas industry held.
“[We] are privileged to play a pivotal role in its consolidation, growth and development. We will continue to seek strategic opportunities that provide a platform for enhanced growth and value creation for our stakeholders,” Tinubu said.
The transaction was financed with an approximate 50:50 debt-equity ratio. Half of the deferred consideration of $33-million was due six months after closing, with the balance due 12 months after closing.
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