LNG

March 19 (LNGJ) - UK company Savannah Energy Plc has signed share purchase deals to acquire controlling interests in the domestic natural gas market of LNG exporter Nigeria. Savannah is taking over all the outstanding share capital of Sinopec International Petroleum Exploration and Production Co. (SIPEC) in Nigeria. SIPEC’s principal asset is a 49 percent non-operated interest in the Stubb Creek oil and gas field in the Akwa Ibom State of Nigeria. The various interests are costing around US$60 million.

   “The SIPEC acquisition will secure significant additional feedstock gas available for sale to Savannah’s 80 percent-owned Nigerian gas processing and distribution subsidiary Accugas Ltd,” explained Savannah. “At present, Accugas has eight principal gas customers, including large thermal power stations such as Calabar Generation as well as key industrial players like Lafarge Africa Plc. “With a weighted average remaining contract life of 14 years, Savannah’s natural gas supplies are a critical enabler of the Nigerian economy and currently support approximately 20 percent of Nigeria’s thermal power generation,” the UK company stated.

Savannah Energy plc, the British independent energy company focused around the delivery of projects in Africa, has signed a share purchase agreement with a unit of Petronas to acquire the Malaysian energy company’s entire South Sudan oil and gas portfolio.

South Sudan is a landlocked nation in East Africa and has only in recent times gained independence.

Savannah Energy’s purchase covers the acquisition of Petronas Carigali Nile Limited for a total cash consideration of up to US$1.25 billion, subject to certain completion adjustments.

“The transaction is expected to be financed through a combination of the enlarged group’s available cash resources and debt,” said a statement.

Savannah is already active with current operations in other African nations such as Chad, Niger, Cameroon and Nigeria.

The London-based company explained that the transaction was conditional upon the satisfaction of certain conditions including approval by the Government of the Republic of South Sudan, the approval of Savannah’s shareholders and re-admission to trading on the London Stock Exchange’s Alternative Investment Market (AIM) taking effect.

China partners

Completion of the transaction would result in the company acquiring PCNL’s interests in three joint operating companies (JOCs) which operate Block 3/7 (40 percent working interest), Block 1/2/4 (30 percent) and Block 5A (67.9 percent) in South Sudan.

The Petronas assets comprise of interests in 64 producing fields, with first production having commenced in 1999.

In 2021, the Petronas assets produced an average gross 153.2 thousand barrels of oil per day.

The major partners in the JOCs include India’s Oil and Natural Gas Corp., two Chinese majors, China National Petroleum Corp. and China Petroleum & Chemical Corp (Sinopec) and Nilepet, the national oil company of South Sudan.

“The transaction constitutes a reverse takeover pursuant to AIM Rule 14 and, accordingly, will be subject to, inter alia, shareholder approval,” added Savannah.

Trading in the company’s ordinary shares were suspended from trading on AIM on December 12.

Savannah also explained that it intended to publish an AIM Admission Document in the first-half of 2023, which would contain a notice of a general meeting at which shareholder approval shall be sought and following which the company would seek restoration to trading on AIM of its ordinary shares.