Award of Crude Allocation by the NNPC
22 Apr 2016
SACOIL HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1993/000460/06)
JSE Share Code: SCL AIM Share Code: SAC
(“SacOil” or “the Company”)
AWARD OF CRUDE ALLOCATION BY THE NNPC
- SacOil and Energy Equity Resources (“EER”) (the “Partners”) signed a memorandum of understanding (“MOU”) to explore oil and gas opportunities in the Republic of Nigeria.
- Pursuant to the initiative, SacOil and EER, was awarded a twelve (12) month term contract for the purchase of Nigerian Crude Oil Grades by the Nigerian National Petroleum Corporation (“NNPC”).
Overview of MOU
SacOil, a South African based independent African oil and gas company and EER entered into a MOU to seek investment opportunities in the business activities of the NNPC within the Nigerian oil and gas sector. The Republic of Nigeria is one of the most prolific oil and gas countries in Africa, with significant investment opportunities available in the current economic climate. The Partners have been evaluating a number of opportunities that could provide sustainable revenue returns.
SacOil is pleased to announce the formation, at a minimal capital cost to SacOil, of a joint venture company with EER called SacOil Energy Equity Resources Limited (“SEER”). SEER is the contracting party to the agreement for the sale and purchase of Nigerian Crude Oil with the NNPC ("the Crude Oil Agreement").
The Crude Oil Agreement provides SEER with the right to acquire crude oil from NNPC for onward sale. The amount of offtake by SEER is dependent on the aggregate crude production in Nigeria and the prevailing global oil price. The revenue generated from the sale of the crude allocation will contribute meaningful income to SacOil and will support SacOil’s growth and investment strategy across the oil and gas value chain on the African continent.
Commenting on the Crude Allocation, SacOil's CEO Dr Thabo Kgogo said:
“This announcement is aligned with our previously communicated strategy to focus on cash generative, income producing activities in both upstream, refining and downstream. Nigeria is a prolific hydrocarbon nation and the largest exporter of crude oil on the African continent. We are pleased to have secured this crude allocation for trading as it provides us with a structured and measured exposure to this attractive market. We look forward to working with EER and the NNPC in future opportunities in the Nigerian oil and gas sector.”
SacOil Holdings Limited
+27 (0)10 591 2260
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Hugh Sanderson / David van Erp
+44 (0)20 7448 0200
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SacOil is a South African based independent African oil and gas company, dual-listed on the JSE and AIM, with business operations in Egypt, the Democratic Republic of Congo ("DRC"), the Republic of Malawi and the Republic of Botswana. The Public Investment Corporation (SOC) Limited (“PIC”) is the largest shareholder of SacOil. SacOil has partnered with the PIC, ENH, Profin and Chinese Pipeline Petroleum Engineering on a project that entails the construction of a gas pipeline from Mozambique to South Africa and the distribution and marketing of gas in southern Africa. SacOil continues to evaluate upstream, refining and downstream opportunities in other established and prolific hydrocarbon basins in Africa.
For further information, please visit www.sacoilholdings.com.