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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                                                             
ISIN: ZAE0000127460                                                             
February 8, 2012                                                                
Johannesburg                                                                    
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:                       
Highlights:                                                                     
*    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      
consideration.                                                                  
ENDS                                                                            
About SacOil                                                                    
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.           
About Transcorp                                                                 
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.                               
About EER                                                                       
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:                                         
JSE Sponsor                                                                     
The Standard Bank of South Africa Limited                                       
AIM Nominated Adviser and Joint                                                 
Broker                                                                          
finnCap Ltd                                                                     
Matthew Robinson / Christopher                  +44 (0)20 7220 0500             
Raggett                                                                         
                                                                                
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             
Crichton-Stuart                                                                 
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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