Oando Plc has finalized the acquisition of 100% of the Nigerian Agip Oil Company (NAOC) from Italian energy giant Eni for $783 million. This acquisition represents a major milestone in Oando’s long-term strategy to expand its upstream operations and solidify its position in Nigeria’s oil and gas sector.
The deal, which includes both asset consideration and reimbursement, enhances Oando’s stake in key Oil Mining Leases (OMLs) 60, 61, 62, and 63 from 20% to 40%. It also broadens the company’s ownership of NEPL/NAOC/OOL Joint Venture assets, which now encompass 40 discovered oil and gas fields, 24 of which are currently producing, along with extensive infrastructure including 1,490 km of pipelines, three gas processing plants, the Brass River Oil Terminal, and the Kwale-Okpai power plants with a combined capacity of 960 MW.
The acquisition significantly boosts Oando’s reserves from 505.6 million barrels of oil equivalent (MMboe) to over 1 billion barrels, marking a 98% increase based on 2022 estimates. The deal is expected to be immediately cash-generative, enhancing Oando’s financial position and cash flows.
Wale Tinubu, Group Chief Executive of Oando Plc, described the acquisition as the culmination of a decade-long effort, beginning with the 2014 acquisition of ConocoPhillips’ Nigerian assets. Tinubu emphasized that this deal not only represents a victory for Oando but also for indigenous energy players, as the company steps into a pivotal role in Nigeria’s upstream sector.
“We are committed to optimizing the assets’ potential, advancing production, and supporting our strategic objectives while adhering to responsible practices and sustainable development,” Tinubu stated. He also outlined plans for future diversification into clean energy, agri-feedstock, and energy infrastructure.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has approved the transaction, underscoring its significance in Nigeria’s energy landscape.
This acquisition follows recent developments involving Oando’s sale of its petrol stations to the Nigerian National Petroleum Corporation (NNPC), reflecting a broader shift in the company’s business strategy.
Despite the promising outlook, Oando has cautioned investors about potential risks, including fluctuations in crude oil prices and uncertainties in international operations. The company advised that while it is optimistic about the acquisition’s benefits, these factors should be considered in future evaluations.
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