July 13, 2024

Norwegian firms conclude asset trade-off over Nigerian oil producing field

Olubunmi Martins

Panoro Energy ASA, Norwegian firm, has announced the final conclusion of the transfer of its equity interests in Nigeria’s OML 113 to PetroNor.  This was contained a statement released, Tuesday, by Panoro Energy.

The firm confirmed that it has now fully completed the sale of its equity interest in the Aje field located in Nigeria’s OML 113 to PetroNor, another Norwegian energy firm.

Recall that EnergyDay had repeatedly  reported a  time frame extension announced by the company to bring this transaction to conclusion.

The transaction will see Panoro Energy receiving upfront consideration of USD10 million in addition to a further USD 16.67 million which is  based on future gas production volumes from the asset.

In the period preceding the conclusion of this transaction, Panoro Energy had said that  ” the deal could fetch a total consideration of up  to $35m, with $10m being paid at closing  and a contingent consideration of up to $25 million based on future gas production.

“The reorganization  will result in a new and restructured joint-venture  company which is expected to be set up, with PetroNor in the process of finalizing a binding agreement with Yinka Folawiyo Petroleum (YFP) – which operates OML 113 – that will see them take the lead on making sure the next phase of developing Aje comes to fruition in an effective and rapid manner”

It is understood that this new JV will operate and be the technical advisor replacing the present structure.

The company confirmed that the current output is around 3,000 barrel per day of oil, and  ‘although that number is expected to rise in the wake of the next development phase’.

In a statement credited to Qazi Qadeer, Chief Financial Officer of Panoro Energy , the company said that the upfront payment it will receive is denominated in the form of 96,577,537 new PetroNor shares issued in favor of Panoro Energy.

EnergyDay gathered that Panoro Energy, until now, had a 6.502% interest in OML 113 which is operated by Yinka Folawiyo Petroleum (YFP) .

The asset was discovered in 1997 outside of Nigeria’s  prolific Niger Delta basin and has multiple reservoirs of oil and gas condensates .

According to official reports published by  Wood MacKenzie ,  the field began production in 2016 from only two wells with further production wells lined up for development.

However , official data obtained by EnergyDay from the NNPC  also  indicate that the asset consistently produced about 3000 bpd but that operations are presently on hold.

It is said that a Field Development Plan for Aje gas was submitted to the Nigerian government for consideration  comprising the development of  four or five production wells  and tied back to existing and new infrastructures including a new FPSO.

Panoro Energy ASA is an independent exploration and production company based in London and listed on the main board of the Oslo Stock Exchange .

The company holds production, exploration and development assets in Africa, specifically,   a producing interest in Block-G, offshore Equatorial Guinea, the Dussafu License offshore southern Gabon, the TPS operated assets, Sfax Offshore Exploration Permit and Ras El Besh Concession, offshore Tunisia and participation interest in an exploration Block 2B, offshore South Africa.

OML 113  is about 12 km close to the West African Gas Pipeline (WAGP) and over the years have evolved in development phases as well as equity holders.

Yinka Folawiyo , a prominent business icon in Lagos originally originally held majority shares of 60% ahead of Vitol’s 12.83%, First Hydrocarbon was content with 9%, Energy Equity Resources was credited with 9%, Panoro Energy had 6.502% and Jack Resources retained 2.667%.

Further exploration of the Dahomey basin, according to industry sources, is continuing with prospects of additional discoveries not ruled out.