Market News
Nigeria: Major revamp of gas-rich field on cards after PetroNor deal wraps up -
Norwegian junior PetroNor E&P has finally completed its acquisition of a key stake in the Aje condensate, gas and oilfield offshore Nigeria – two years and nine months after first announcing the deal.
This deal will trigger a redevelopment on the shallow water field close to Lagos and the West Africa Gas Pipeline, with the focus on commercialising its 1.1 trillion cubic feet of gas.
Oslo-listed PetroNor has bought Panoro Energy’s 15.1% effective economic interest in Oil Mining Lease 113, which hosts the producing Aje field, for $10 million worth of new PetroNor shares, with its stake expected to rise to 20.2% over three years.
The transaction also involves a contingent consideration of up to $16.67 million based on future gas production volumes.
This acquisition clears the path for the establishment of Aje Production AS, a 52%/48% joint venture between PetroNor and Nigeria’s Yinka Folawiyo Petroleum (YFP), that will operate the field.
PetroNor’s interim chief executive Jens Pace aid: “We are pleased to confirm that this long-awaited transaction with Panoro has now been completed.”
“The acquisition of the ownership interest in the Aje field is strategically attractive and supports our stated growth strategy of acquiring assets that add production, material reserves and resources to the company.”
“With the establishment of Aje Production, YFP and PetroNor will form a dynamic and effective licence partnership to lead the redevelopment of the Aje field,” he said.
Osamede Okhomina, chief executive of Aje partner ADM Energy, said:“The conclusion of PetroNor's acquisition of Panoro's interest in OML 113 marks a significant event … as it now allows us to further concentrate on accelerating the development plans for Aje.”
He said: “PetroNor's decision to acquire a stake in the Aje field is a strong endorsement of the quality and considerable potential of the asset and we look forward to working with them to take Aje to the next stage.”
Aje has been producing liquids via the Front Puffin FPSO, while gas was flared.
The new operating joint venture has a redevelopment plan that could see production running at about 25,000 barrels of oil equivalent per day.
This new plan aims to commercialise Aje’s gas resources by piping it to Lagos to feed a 500 MW power plant.
