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SacOil Buys Into Nigeria Oil Field

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07 Dec 2010

SacOil buys into Nigeria Oil Field

Pan African oil and gas company SacOil and its joint venture (JV) partner Equity Energy Resources have each acquired a 20% interest in an oil licence off the coast of Nigeria. Project owner Nigdel United Oil Company would retain the remaining 60% shareholding in the licence area.

Under the terms of the acquisition, the JV partners would pay $8-million in two tranches, with the first $0,3-million paid upon the execution of agreements with Nigdel, and the remaining $7,8-million payable once Nigerian governmental approval has been received.

SacOil said in a statement on Tuesday that first oil production from the licence area was expected by mid-2013, at a rate of around 7 200 bbl/d, building up to 10 000 bbl/d.

The JV will carry 100% of the minimum work programme cost until first oil production and would have control on financial, technical and operational decision making. The estimated cost of 100% of the minimum work programme is about $50-million.

SacOil said that the agreement is the first for the JV and marked a “significant milestone” in the development of SacOil. The JV was now actively pursuing other short-term production situations in Nigeria with the view to progressing its near term production strategy.

Source: Engineering News Online