Africa Oil Corp., a Canadian oil and gas company, has obtained clearances from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for two significant actions: the amalgamation of its wholly owned subsidiary, Africa Oil Papa Corp., with BTG Pactual Holding, and the extension of a petroleum mining license offshore Nigeria.
The deal, which was announced in June, encompasses the consolidation of 100% ownership of Prime Oil & Gas Coöperatief in Africa Oil in exchange for the issuance of common shares in the Canadian firm to BTG Pactual Oil & Gas.
Since the amalgamation does not entail a change of control in the beneficial ownership of Prime’s Nigerian subsidiaries, the regulator has allowed it to proceed as proposed, noting that ministerial consent is not required.
Dr. Roger Tucker, Africa Oil Chief Executive Officer (CEO), said: “We are grateful to NUPRC for its timely response to Prime’s application for regulatory clearance in respect of the transaction. We shall move forward promptly to complete the amalgamation, which we now expect to be achieved by the end of the first quarter of 2025.”
The completion of the amalgamation is subject to several customary closing conditions, including competition clearance from the Federal Competition & Consumer Protection Commission (FCCPC), approval from Nasdaq Stockholm, completion of the previously announced farm-down of Africa Oil’s Namibian interests that are held via Impact Oil & Gas Limited, and a reorganization of the holding structure of BTG Pactual Holding to implement the amalgamation.
The Canadian player was also granted an extension of petroleum mining lease 52 (PML 52), containing part of the Agbami field, described as one of Nigeria’s largest deepwater discoveries. The 20-year extension is set to become effective on November 24, 2024. The field, situated approximately 113 kilometers off the coast of the central Niger Delta rregion,is developed via sub-sea wells tied back to a floating production storage and offtake (FPSO) vessel—SO Agbami—through steel catenary risers.
“The renewal of PML 52 follows last year’s renewal of the licenses for Prime’s Akpo, Egina, and Preowei fields. With respective 20-year renewals for each of these fields, our long-term production outlook from these high-quality assets is secure. We thank NUPRC for its efficient processing of the application and issuing the renewal,” noted Africa Oil CEO.
PML 52 covers 62.46% of the producing Agbami field discovered by the Agbami-1 well in 1998. The largest interest in the PML 52 production sharing agreement of 60% is held by Famfa Oil, followed by Chevron’s 32% operating interest and Prime Oil & Gas Coöperatief’s 8%. Following the completion of the amalgamation transaction, the Canadian player’s 50% interest in Prime and thus its stake in the PML is set to increase to 100%.
The field started producing in June 2008, reaching peak gross field production of 250,000 barrels of oil per day (bopd) a year later. It contains oil described as light with a gravity of 45° to 47° API.
The Canadian company reported that by December 31, 2023, it had drilled 30 producers, five gas injectors, and ten water injectors, leading to a cumulative oil production from the field that exceeded 1,089 million barrels. In 2023, its average oil production rate was approximately 98,000 barrels of oil per day (bopd).
