Nigeria: Heirs Holdings, Transcorp Buy OML 17

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Africa-focused investment company Heirs Holdings, in partnership with the publicly listed conglomerate Transnational Corporation of Nigeria (Transcorp), has announced their purchase of a 45 percent participating interest in OML 17 through oil and gas operating company TNOG Oil and Gas Limited. TNOG will be the sole owner of the oil-producing block.

Chairman of Heirs Holdings Tony Elumelu said: “We have a very clear vision: creating Africa’s first integrated energy multinational, a global quality business, uniquely focused on Africa and Africa’s energy needs. The acquisition of such a high-quality asset, with significant potential for further growth, is a strong statement of our confidence in Nigeria, the Nigerian oil and gas sector and a tribute to the extremely high-quality management team that we have assembled.”

The transaction includes financing of $1.1 billion, provided by a consortium of global and local banks and investors. OML 17 is currently producing an average of 27,000 barrels of oil per day, with 2P reserves of an estimated 1.2 billion barrels, and 1 billion barrels of oil equivalent resources to explore. Heirs Holdings and Transcorp purchased the 45 percent stake from Eni, Total and Shell. Schlumberger will be a technical partner and Shell’s trading division is the off-taker.

Elumelu added: “As a Nigerian, and more particularly an indigene of the Niger Delta region, I understand well our responsibilities that come with stewardship of the asset, our engagement with communities and the strategic importance of the oil and gas sector in Nigeria.”

Heirs Holdings’ subsidiary Tenoil controls the OPL 2008 exploration block in a production sharing contract with NNPC, as well as the Ata Marginal Field, which will begin to produce a projected 3,500 barrels daily from the second quarter of 2021.

President and Group CEO of Transcorp, Owen Omogiafo, said: “This deal further demonstrates Transcorp’s integrated energy strategy and our determination to power Africa.”

With its ownership of the Transcorp Power Plant, Afam Power Plc and Afam Three Fast Power Limited (the latter two acquired for $300 million in November 2020), Transcorp is one of the biggest energy providers in Nigeria, with an estimated 2,000 MW of installed energy capacity. It also supplies power to the Republic of Benin and operates exploration block OPL 281 with NNPC.

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Nzube Nlebedim

Nzube Nlebedim

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