Seplat Petroleum Development Co. Plc has completed stake acquisitions in OML 53 and OML 55 in Nigeria.
Seplat has completed the acquisition of a 40% working interest in OML 53, onshore north eastern Niger Delta from Chevron Nigeria Ltd. (CNL). NNPC holds the remaining 60% interest in OML 53. Seplat has been designated as operator of OML 53.
For OML 53, the upfront acquisition cost to Seplat is $254.6 million, of which $69 million had previously been paid as a deposit in 2013 and $185.6 million paid at completion. The adjustments to the upfront acquisition cost include a deferred payment of $18.75 million contingent on oil prices averaging $90 a barrel or above for 12 consecutive months over the next five years.
OML 53 covers an area of 612 square miles (1,585 square kilometers) and is located onshore in the north eastern Niger Delta. The Jisike oil field, located in the northwestern area of the block, is currently the only producing field on OML 53.
Seplat has also concluded negotiations to purchase 56.25% of the share capital of Belemaoil Producing Ltd., a Nigerian special-purpose vehicle (SPV) that has completed the acquisition of a 40% interest in the producing OML 55, located in the swamp to coastal zone of southeastern Niger Delta, from Chevron Nigeria Ltd. NNPC holds the remaining 60% interest in OML 55. Seplat’s effective working interest in OML 55 as a result of the acquisition is 22.5%.
The cost for Seplat to acquire its 22.5% effective working interest in OML 55 is $132.2 million. The company has also advanced certain loans of $132.9 million to the other shareholders of Belemaoil to meet their share of investments and costs associated with Belemaoil. Consequently, the upfront cash outlay to Seplat after adjustments is $265.1 million. The adjustments to the upfront acquisition cost include a deferred payment of $20.6 million contingent on oil prices averaging $90 a barrel or above for 12 consecutive months over the next five years.
OML 55 covers an area of 324 square miles (840 square kilometers) and is located in the swamp to shallow water offshore areas in the south eastern Niger Delta. The block contains five producing fields (Robertkiri, Inda, Belema North, Idama, and Jokka). The majority of production on the block is from the Robertkiri, Idama, and Inda fields. Seplat has been designated operator of OML 55. The company will also act as technical services provider to Belemaoil.