Italian energy major Eni has completed the previously announced $783m sale of Nigerian Agip Oil Company (NAOC) to Oando, a Nigeria-based energy solutions provider.
The deal, which was initially announced in September 2023, has been completed following the necessary approvals from all relevant regulatory bodies, including the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), which granted its approval last month.
NAOC, which was a fully owned subsidiary of Eni, is active in the Nigerian oil and gas sector, focusing on onshore exploration and production, alongside power generation.
The company operates four onshore oil blocks, OML 60, 61, 62, and 63, through a joint venture arrangement, where NAOC holds a 20% stake, Oando also holds 20%, and NNPC E&P has a 60% share.
NAOC is also involved in the operation of the Okpai 1 and 2 power plants, which collectively have a nameplate capacity of 960MW. Additionally, the firm maintains operatorship of two onshore exploration leases, OPL 282 and OPL 135, with interests of 90% and 48%, respectively.
The sale excludes NAOC’s interest in the Shell Production Development Company joint venture (SPDC JV). In this venture, Shell operates with a 30% interest, TotalEnergies holds 10%, NAOC has a 5% stake, and NNPC owns 55%.
This particular interest will remain under Eni’s ownership.
The completion of this sale is in line with Eni’s strategic focus on streamlining its upstream activities. The company aims to rebalance its portfolio by divesting non-core assets while maintaining a presence in Nigeria through investments in deepwater projects and Nigeria LNG.
For Oando, listed on both the Nigerian Exchange Limited and the Johannesburg Stock Exchange, the transaction represents a significant step in its long-term strategy to enhance its upstream operations and solidify its position within Nigeria’s oil and gas industry.
The transaction increases Oando’s stake in the OML 60, 61, 62, and 63 blocks to 40%.
It also expands its ownership in the NEPL/NAOC/OOL JV assets, which include 40 discovered oil and gas fields, nearly 40 identified prospects, and 12 production stations. The deal also covers approximately 1,490km of pipelines, three gas processing plants, the Brass River Oil Terminal, and the Kwale-Okpai phases 1 and 2 power plants.
According to reserves estimates from 2022, Oando’s total reserves are currently 505.6 million barrels of oil equivalent (MMboe). The acquisition is projected to increase these reserves by 493.6MMboe.
Oando group chief executive Wale Tinubu said: “Today’s announcement is the culmination of ten years of toil, resilience, and an unwavering belief in the realisation of our ambition since the 2014 entry into the Joint Venture via the acquisition of ConocoPhillips Nigerian Portfolio.
“It is a win for Oando, and every indigenous energy player, as we take our destiny in our hands, and play a pivotal role in this next phase of the nation’s upstream evolution.
“With our assumption of the role of operator, our immediate focus is on optimising the assets’ immense potential, advancing production and contributing to our strategic objectives.”
