Announcement on OML 125 & 134 Acquisition

abarrelfullabarrelfull wrote on 24 Jul 2012 12:12
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June 2008

Introduction

Shareholders are referred to the announcement released on SENS on 25 February 2008 as well as the subsequent cautionary announcements released on SENS on 2 April 2008, 14 May 2008 and 25 June 2008 respectively. Shareholders are advised that Oando has paid for a 15.0% interest in the Production Sharing Contracts ("PSCs") in respect of offshore Nigeria Oil Mining Licence ("OML") 125 and OML 134 (the "Transaction"). The Transaction has been agreed with Nigerian AGIP Exploration Limited (“AGIP”) subsequent to AGIP’s exercise of its preemption rights over Shell Nigeria Exploration and Production Company Limited's ("Shell") entire 49.81% interest in the PSCs and JOA in respect of OML 125 and OML 134. Standard Chartered has acted as Oando’s sole financial adviser for this transaction.

Rationale for the Transaction

Oando is Nigeria's largest energy group with strategic investments in a range of energy companies across West Africa. With its investments and diversified business model the Company is fast achieving its goal of being "the leading integrated energy solutions provider". The Transaction represents a rare opportunity to acquire a balanced upstream asset portfolio
in our home market in line with our stated principle to acquire proven and actively producing properties that demonstrate the potential for increased financial return. Oando, through the Transaction, will benefit from partnering with AGIP, a world class operator with significant experience in Nigeria.

The assets being acquired include production from the Abo field combined with near term production growth and high potential exploration acreage to complement Oando's existing upstream position. The Transaction brings approximately 3,000 barrels per day of crude oil production, 24.8 million barrels of 2P and risked contingent reserves and turns Oando into Nigeria's leading indigenous exploration and Production Company.


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