Heritage confirms $850 million Nigerian acquisition
BY IAIN PACKHAM
LONDON--Heritage Oi Monday confirmed that its joint venture subsidiary has agreed to buy a 45% stake in an oil mining lease and other assets for $850 million from Royal Dutch Shell, Total S.A. and Nigerian National Petroleum Corp.
The company said the proposed acquisition by Shoreline Natural Resources Ltd., its special purpose private Nigerian company formed between a subsidiary of Heritage and a local Nigerian partner Shoreline Power Company Ltd., will boost the company's oil production to around 11,350 barrels of oil a day, from 605 barrels a day.
The license, OML 30, is located onshore in the delta in Nigeria, less than 50 kilometers east of Warri in Southern Nigeria. The lease covers 1,097 square kilometers and includes eight main producing fields with oil and gas contained in numerous stacked reservoirs.
The acquisition assets also include a 45% interest in the segment of the Trans Forcados pipeline between the Eriemu manifold and the Forcados River manifold. Based on current information provided by the vendors, crude production from OML 30 is averaging around 35,000 barrels of oil a day and Heritage management, based on due diligence to date, estimates gross proved and probable reserves of 707 million barrels of oil.
Heritage Chief Executive Tony Buckingham said the acquisition (first reported by Dow Jones Newswires Sunday) is transformational for the company and represents a significant opportunity for it to achieve a material change in production and reserves.
Following completion of the deal, the operatorship of OML 30 will transfer from Shell to the Nigerian Petroleum Development Company, a subsidiary of the Nigerian National Petroleum Corp.
Dow Jones Newswires