SCL - Sacoil Holdings Limited - Revised terms for Entry into OPL 281 Licence Release Date: 08/02/2012 09:00:02 Code(s): SCL
SCL - Sacoil Holdings Limited - Revised terms for Entry into OPL 281 Licence
Nigeria and Issue of shares for cash to YA Global Masters SPV Ltd
SACOIL HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1993/000460/06)
JSE share code: SCL
AIM share code: SAC
February 8, 2012
Revised terms for Entry into OPL 281 Licence Nigeria and
Issue of shares for cash to YA Global Masters SPV Ltd
SacOil, the independent African upstream oil & gas company, announces it has
agreed revised terms for its partnership with Transnational Corporation of
Nigeria PLC (`Transcorp`) and Energy Equity Resources (`EER`) and has also
agreed a specific issue of ordinary shares (`SEDA shares`) to YA Global
Masters SPV Ltd ("YA").
1. Revised terms of the farm-in to licence OPL 281:
* A reduction in farm-in fees for SacOil and EER, its technical joint
venture partner, from $32.5m to $24.5m
* Transcorp will remain the operator of OPL 281 and will pay its 60%
of the CAPEX costs to first production as opposed to SacOil and EER
carrying 100% of the CAPEX costs as previously agreed
* Transcorp to post the performance bond to the Nigerian Government
Initiated by Transcorp, the revised terms followed as a result of a change of
control in Transcorp. Pursuant to the change, Transcorp`s aim is to take full
responsibility for the operation of the concession and to become a leading
Nigerian indigenous oil & gas upstream company with production.
Following this revision, EER`s 50% portion of the fees is carried by SacOil
as an interest bearing loan to EER that is repaid from EER`s entitlement to
production in OPL 281. SacOil paid $12.5 million towards the Signature Bonus
on 28 February 2011 and the outstanding $12m becomes due once the remaining
conditions precedent to the farm-in agreement have been met. These include
perfection of title and all the necessary Nigerian government and Nigerian
National Petroleum Company (`NNPC`) consents in relation to the licence.
According to the partners, a work programme budget of $15.0 million is
estimated for phase 1 of the exploration of OPL 281 and involves the
reprocessing of the existing 3D seismic data and the drilling of at least one
well. A Competent Person`s Report issued by reserves auditing firm, AGR-TRACS
International Limited, has attributed a gross unrisked contingent resource of
approximately 100MMboe, with additional potential in two further prospects
and deeper zones.
Commenting, Robin Vela, Chief Executive Officer of SacOil, said:
We are pleased with the revised terms as we will no longer be required to
provide Transcorp with a carry on CAPEX costs from the point of entry to
first oil. All costs are now carried proportionately to the equity owned by
Transcorp, EER and SacOil. SacOil and EER will be actively involved in the
operations through the Operations and Management Committees.
Commenting, Obinna Ufudo, Chief Executive Officer of Transcorp, said:
The revised agreement is in line with Transcorp`s vision of building a pan-
African energy business with strong indigenous operational capabilities. We
are now poised to lead the process of bringing the asset to production.
Commenting, Osamede Okhomina, Chief Executive Officer of EER, said:
The revised commercial terms reduces our CAPEX exposure whilst improving our
rate of return in the project. Furthermore, EER has a key role to play in
supporting Transcorp to bring the asset to production. We look forward to
working with our partners on this project.
2. Issue of shares for cash to YA Global Masters SPV Ltd
SacOil shareholders ("Shareholders") are advised that 10 926 906 SEDA Shares
have been issued to YA at a price of R0,44 per Share pursuant to the terms of
the Standby Equity Distribution Agreement dated 12 October 2011 and approved
by Shareholders in a general meeting on 17 November 2011.
Application has been made to the JSE Limited ("JSE") to grant a listing of
the SEDA Shares and to the London Stock Exchange for the admission of the
SEDA Shares to trading on the AIM Market (`AIM`). The listing of the SEDA
Shares on the JSE and the admission of the SEDA Shares to trading on AIM are
expected to take place on Thursday, 9 February 2012. The proceeds of the
issue of the SEDA Shares will be utilised mainly to ensure that SacOil has
sufficient short term cash to pay for costs in relation to proposals under
SacOil is a South African based JSE and AIM listed Exploration & Production
Company focused exclusively on operations in Africa, where it has a
competitive advantage at the point of entry. To date it has operations in
the DRC (and since partnered with Total), Nigeria and South Africa and
continues to evaluate a number of opportunities to secure new value accretive
acreage in other established and prolific African hydrocarbon basins.
Transcorp, a company quoted on the Nigerian Stock Exchange, is a diversified
conglomerate with strategic investments and core interests in the
Hospitality, Agro-business and Energy sectors. Some of its more notable
assets include OPL 281, Transcorp Hilton Hotel, Abuja; Transcorp Metropolitan
Hotel, Calabar and Teragro, the agribusiness subsidiary operating a fruit
juice concentrates plant in Benue State, Nigeria.
EER is an established Oil & Gas Exploration and Production company
headquartered in London with an operating office in Lagos and operations and
assets in Nigeria. EER has interests in several assets in Nigeria and the
Nigeria/ Sao Tome Joint Development Zone. EER has a unique mixture of private
Nigerian, International and British institutional shareholders.
About OPL 281
OPL 281 is an onshore block covering an area of 138kmSquared and is located
in the western delta region of Nigeria, 25 kilometres away from the Forcados
Crude Export Terminal. Between 1967 and 1970 two discovery wells were
drilled. The block was reinstated to Transcorp in April 2011. Current equity
ownership of Transcorp 60%, EER 20% and SacOil 20% remains unchanged.
For further information please contact:
The Standard Bank of South Africa Limited
AIM Nominated Adviser and Joint
Matthew Robinson / Christopher +44 (0)20 7220 0500
Joint Broker (United Kingdom)
Shore Capital Stockbrokers Ltd
Jerry Keen / Bidhi Bhoma +44 (0)20 7408 4090
Public Relations (South Africa)
The Riverbed Agency (SA)
Raphala Mogase / Bongiwe Moeli +27 (0) 11 783 7903
Public Relations (United Kingdom)
Pelham Bell Pottinger (UK)
Philip Dennis/ Nick Lambert/Rollo +44 (0)20 7861 3232
Additional information on SacOil can be found at www.sacoilholdings.com.
Date: 08/02/2012 09:00:02 Supplied by www.sharenet.co.za
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