Oando PLC has announced the successful completion of its acquisition of the Nigerian Agip Oil Company (NAOC) in a significant transaction valued at approximately $783 million. This deal, confirmed through a recent press release by Oando PLC, marks a pivotal achievement in the company’s long-term strategy. The acquisition was financed through a combination of cash and asset consideration.
According to Oando PLC, this acquisition is poised to reinforce the company’s position in Nigeria’s oil and gas sector, significantly enhancing its operational capabilities and expanding its upstream interests. The deal follows regulatory approval from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), which also confirmed the completion of the transaction. The NUPRC had previously granted approval for the sale of NAOC’s shares by the Italian oil major Eni to Oando PLC.
NAOC, now part of Oando’s portfolio, is known for its focus on onshore oil and gas exploration, production, and power generation within Nigeria. With this acquisition, Oando’s stake in key Oil Mining Leases (OMLs) 60, 61, 62, and 63 has increased from 20% to 40%, expanding its ownership across all NEPL/NAOC/OOL Joint Venture assets. This includes 40 discovered oil and gas fields, of which 24 are currently in production.
In addition to increasing its participation in oil blocks, Oando now holds a significant share in crucial infrastructure. This includes approximately 1,490 km of pipelines, three gas processing plants, the Brass River Oil Terminal, and the Kwale Okpai power plants, which boast a combined capacity of 960 MW. This expansion further solidifies Oando’s infrastructure presence in Nigeria.
The acquisition has led to a substantial increase in Oando’s reserves, boosting its total from 505.6 million barrels of oil equivalent (MMboe) to over 1 billion barrels, reflecting a 98% rise based on 2022 reserve estimates. This enhancement is expected to have an immediate positive impact on the company’s cash flow and overall financial position.
Wale Tinubu, Group Chief Executive of Oando PLC, highlighted the strategic importance of this acquisition as the culmination of a decade-long effort. He emphasized that the transaction represents a significant win for Oando and indigenous energy players, underscoring their pivotal role in the future of Nigeria’s upstream sector.
Tinubu also stressed Oando’s commitment to optimizing the newly acquired assets while focusing on sustainable development and contributing to Nigeria’s oil production goals. Despite acknowledging the inherent risks and uncertainties associated with the transaction, including potential changes in project parameters and future crude oil prices, Oando remains confident in the acquisition’s potential to drive growth and value creation. The company is also exploring diversification opportunities in clean energy, agri-feedstock, and energy infrastructure.
