ADM Energy and Trafigura Form Strategic Alliance for African Energy Projects
AIM-listed oil & gas investment company ADM Energy Plc has entered into a non-binding MoU with international commodity trading firm Trafigura Pte Ltd. to develop investment opportunities in the African energy sector. Under the terms of the MoU, which currently has a term of up to 12 months, ADM Energy will act as the sponsor for investment opportunities which will be presented to Trafigura for consideration as a trading counterparty or a financing provider. Trafigura will be entitled to provide ADM Energy with conditional pre-financing of up to US$100 million for the acquisition or development of certain approved projects. It is also anticipated that Trafigura may subscribe for up to US$20 million in convertible loan notes in ADM as definitive agreements and project funding for approved projects are agreed. Trafigura will also have the exclusive rights to market the crude oil produced by any approved project that it has financed, on market terms and for an agreed period. ADM Energy currently holds a 5% equity interest in the producing Aje Field located within OML 113, offshore Nigeria. The company’s strategy has been focused on building on its existing asset base in Nigeria and target other investment opportunities across the West African region.