Page 11 - AfrOil Week 01 2020

AfrOil
NEWS IN BRIEF
AfrOil
UPSTREAM
LEKOIL to borrow $184mn from Qatar Investment Authority to finance drilling at OPL 310
Lekoil 310 Ltd, a wholly-owned subsidiary of LEKOIL, has entered into a binding loan agree- ment with the Qatar Investment Authority (QIA), the sovereign wealth fund of the State of Qatar, for $184.0mn. The facility will be dis- bursed in five tranches over 11 months, with the first drawdown intended to occur in February 2020. The company looks forward to providing further details on the intended work programme in short order.
The tranching of the drawdown of funds under the terms of the Facility is expected to enable LEKOIL to meet the costs commitments under the envisioned work programme as and when they arise.
The facility, which has a tenure of seven years from the date of first disbursement, is secured against, amongst other things, the shares and assets of Lekoil 310 and Mayfair Assets and Trust Ltd and includes a moratorium on both the interest and principal repayments commencing from the date of the facility until six months after the commencement of commercial sale of pro- duction from the field.
Repayment of the principal and interest will occur subsequently, in equal instalments, on a semi-annual basis.
LEKOIL holds its interest in OPL 310 through Mayfair and Lekoil 310. The facility is not secured against any other assets or interests of the company, including its interest in the pro- ducing Otakikpo marginal field.
The annual interest rate payable on amounts drawn under the Facility is 3.72%, with an upfront fee of 2.75% of the amount drawn under the facility, which is payable upon drawdown of the facility.
A debt service reserve account will be estab- lished 12 months after the end of the morato- rium period with a one-off amount equal to six (6) months of debt service standing to its credit. The company will be required to meet a number of covenants on an ongoing basis in order for the facility to remain in good standing, and adhere to QIA’s policies on procurement, environment and social responsibility and anti-corruption. The facility is subject to an event of default clauses and a provision that the employment of the Company’s CEO cannot be terminated without good cause during the term of the facility.
The facility was arranged by Seawave Invest Ltd, an independent consultancy firm
specialising in cross-border transactions with an exclusive focus on Africa.
After deducting the commission payable to Seawave by LEKOIL for arranging the facility and the upfront fee payable by LEKOIL to the QIA as set out above, the net proceeds of the facility available to the company are approxi- mately $174.3mn.
Lekan Akinyanmi, LEKOIL’s CEO, said: “Fol- lowing the recent achievements of the OPL 310 license extension and the securing of funding for the appraisal drilling and development pro- gramme, we are delighted to have made strong progress, as promised, towards the start of the appraisal drilling programme on Ogo. We will continue to work closely with our partner and the Operator of the OPL 310 License, Opti- mum Petroleum, as we pursue value for our shareholders.”
LEKOIL, January 02 2020
GTL
NNPC, Chevron sign
package of agreements
covering Escravos
gas-to-liquid project
Nigerian National Petroleum Corp. (NNPC) and Chevron Nigeria Ltd (CNL) have executed agreements over the multi-billion-dollar Escra- vos Gas-to-Liquid (EGTL) project.
Speaking at a sign-off meeting in Abuja, the Group Managing Director of the corporation, Mele Kyari, disclosed that CNL would boost
the domestic gas market with 400mn cubic feet (11.3mn cubic metres) per day of natural gas supply, equivalent to 26% of total domestic gas supply in the country.
NNPC Acting Group General Manager, Group Public Affairs Division, Samson Makoji, in a release said Kyari had described the EGTL plant as “a cornerstone of the energy ecosystem of Nigeria” disclosed that it had the potential to yield US$2billion into the coffers of the Federal Government.
He also acknowledged the roles that were played by President Muhammadu Buhari and the Chairman, Senate Committee on Gas, Bas- sey Akpan, which he noted had culminated into the execution of the agreements, assuring that the Federal Government was committed to the project.
In his remarks, the Chief Executive Officer of CNL, who was represented by the Direc- tor, NNPC/Chevron Nigeria Ltd joint venture, Monday Ovuede, said the project would open up opportunities for gas commercialisation and monetisation in the oil and gas industry.
Ovuede stressed that one of the values would include provision of clean and environmentally friendly energy. He stressed the Nigerian side’s commitment to fostering a mutually beneficial relationship with the corporation in the energy sector.
The highpoint of the event was the signing of five sets of agreements which include: the Set- tlement Agreement; Amendment to the Ven- ture Agreement; Sales and Purchase Agreement; Depository Agreement for Special Purpose Vehicle; and Agreement for Power of Attorney to be given to CNL as the representative of the sellers.
NNPC, December 24 2019
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