Analysts have described the investment of over $1billion by Heirs Holdings to procure strategic OML 17 from Shell, ENI and Total, as an affirmation of confidence in Nigeria’s economy.
Heirs Holdings, the leading African strategic investor, in partnership with affiliated company Transnational Corporation of Nigeria Plc (Transcorp), acquired a 45 percent participating interest in Nigerian oil licence OML 17 and related assets, through TNOG Oil and Gas Limited (a related company of Heirs Holdings and Transcorp), from the Shell Petroleum Development Company of Nigeria Limited, Total E&P Nigeria Limited and ENI.
The remaining 55 percent stays with the Nigerian National Petroleum Corporation (NNPC). In addition, the Heirs Holdings Group will take over operatorship of OML 17, demonstrating the strength and quality of the industry team assembled by Tony Elumelu’s group.
Heirs Holdings was advised by Standard Chartered Plc, as Global Coordinator, and United Capital Plc, with a syndicate of lending institutions including Afreximbank, ABSA, Africa Finance Corporation, Union Bank of Nigeria, Hybrid Capital, and global asset management firm Amundi.
The deal also involves Schlumberger as a technical partner and the trading arm of Shell, as an offtaker. Heirs Holdings’ ability to bring together global and African investors, in one of the biggest African deals of the last 10 years, is a tribute to its professionalism and determination.
The company has been at the forefront of Elumelu’s Africapitalism philosophy, championing the private sector’s leadership in developing Africa.
President of Oil and Gas Service Providers Association of Nigeria, Maxi Colman Obasi, said: “At a time of increased pessimism globally and in Nigeria, the huge deal shows a welcome light on the opportunities that are available in Nigeria. Heirs Holdings is a committed indigenous business and the presence of Transcorp, Nigeria’s largest listed conglomerate, with over 300,000 shareholders in the transaction would impact on operations.”
“The deal further demonstrates the ability of Tony Elumelu led Heirs Holdings to spearhead Africa’s economic resurgence, amidst the calamity posed by COVID-19 pandemic,” Obasi said in an interview with Energy Vanguard at the weekend.
Emeka Obidike, Executive Secretary, Lubricants Producers Association of Nigeria, LUPAN, who also spoke in another interview, said: “It is a very good development that comes in the spirit of local content. Specifically, the operations of the OML 17 would deepen and expand Local content, capacity building and technology transfer in Nigeria. It would also assist the nation to retain capital flight while creating additional jobs for Nigerians.
“I am optimistic that the new management would do well, considering its track records in other investments. In fact, many indigenous companies are doing well in the upstream sector, and Heirs Holding would not be an exception.”