The African Export-Import Bank (Afreximbank) has successfully facilitated a $650 million financing package for Oando Petroleum and Natural Gas Company Limited, enabling the acquisition of a 100% stake in the Nigerian Agip Oil Company Ltd. (NAOC). This strategic move marks a significant milestone in Nigeria’s energy sector and reinforces Oando’s position as a leading indigenous energy solutions provider.
Key Highlights:
- Financing Structure:
- $500 million senior facility
- $150 million junior reserve-based lending facility
- Acquisition Details:
- Oando acquired NAOC’s 20% participating interest in the NEPL/NAOC/Oando Joint Venture.
- Transaction completed and announced on [specific date]
- Joint Venture Assets:
- Oil mining licenses: 60, 61, 62, and 63
- Historical production: 4.4 billion barrels of oil and 12 trillion cubic feet of natural gas
- Remaining reserves: 1.2 billion barrels of oil and 10.7 trillion cubic feet of natural gas
- Afreximbank’s Role:
- Mandated lead arranger
- Bookrunner, coordinator, underwriter, escrow agent, facility agent, and security trustee
- Underwrote $350 million of the facility
- Additional Participants:
- Indorama Eleme Petrochemicals Limited: $150 million
- Mercuria Energy Group: $150 million
Industry Impact:
Haytham Elmaayergi, Executive Vice President of Global Trade Bank at Afreximbank, emphasised the transaction’s significance: “This facility advances our strategy to promote local content in Africa’s oil and gas sector. By supporting indigenous companies like Oando in acquiring key energy assets, we’re fostering economic empowerment, enhancing regional trade, and contributing to the sustainable development of Africa’s natural resources.”
The acquisition aligns with Nigeria’s local content policy, energy security, and economic sovereignty strategy, highlighting the growing role of local companies in owning and operating critical energy assets.
Oando’s Perspective:
Wale Tinubu, Group Chief Executive of Oando, expressed his enthusiasm: “This announcement culminates a decade of determination and unwavering belief in our ambition since entering the joint venture in 2014. It’s a victory for Oando and all indigenous energy players, as we take control of our destiny and play a crucial role in the next phase of Nigeria’s upstream evolution.”
Tinubu also commended Afreximbank’s leadership in bridging Africa’s trade finance gap, which enabled Oando to consolidate its stake in the joint venture through the acquisition of NAOC’s 20% stake.
Conclusion:
This landmark transaction not only strengthens Oando’s market position but also demonstrates the increasing capacity of African financial institutions and energy companies to drive significant industry developments. As Nigeria’s energy sector continues to evolve, the successful completion of this deal sets a precedent for future indigenous-led acquisitions and investments in the continent’s natural resources.