Heirs Holdings and Transcorp Acquire 45% in OML 17 from Shell, TOTAL and Eni
Privately held Nigerian investment company Heirs Holdings Ltd. and its affiliate Transnational Corporation of Nigeria Plc (Transcorp) have entered into an agreement with oil majors Royal Dutch Shell Plc, TOTAL SA, and Eni SpA to acquire a 45% operated interest in Oil Mining Lease (OML) 17 located in the Eastern Niger Delta, for a total estimated consideration of around US$800 million.
The total consideration payable by Heirs Holdings and Transcorp includes a US$533 million payment to Shell for its 30% interest, US$180 million to TOTAL for its 10% interest, and an estimated US$90 million to Eni for its 5% interest in the lease.
Upon completion, TNOG Oil & Gas Ltd., a related company of Heirs Holdings and Transcorp, will hold a 45% operated interest in OML 17, and Nigerian National Petroleum Corp. (NNPC) will hold the remaining 55%.
OML 17 covers an area of 1,300 sq. km onshore in the Eastern Niger Delta basin, located approximately 16 km north-east of Port Harcourt. The license contains 15 oil & gas fields, 6 of which are currently producing (including the Agbada and Ubima fields). The transaction also includes associated infrastructure, six flow stations, two associated gas gathering facilities, and two gas plants under construction. Current gross average daily production from the lease amounts to around 27,000 barrels of oil equivalent per day (boe/d).
“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,” said Tony O. Elumelu, the Chairman and controlling shareholder of Heirs Holding.
“We see significant benefits from integrating our production, with our ability to power Nigeria, through Transcorp, and deliver value across the energy value chain. 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,” he continued.
Heirs Holding is focused on investment activities across the financial services, power, oil & gas, real estate, hospitality, and healthcare in Nigeria. The company is also a major shareholder in Transcorp, which is listed on the Nigerian Stock Exchange and holds a portfolio of investments in the hospitality, agribusiness, and energy sectors.
Standard Chartered acted as global coordinator to Heirs Holdings on the debt financing for the transaction, while United Capital acted as financial advisor.