M a r k e t N e w s
Shell Logo Shell Sells OML 29
Posted on : Friday, 10th October 2014
Oil major, Royal Dutch Shell has agreed to sell the prolific Oil Mining Lease (OML) 29 to a consortium led by oil-trading firms Aiteo and Taleveras Group in a deal in which the consortium will pay $2.58 billion for the block and an associated pipeline according to This Day.
Shell had indicated its plan to sell four of its onshore oil blocks – OMLs 18, 24, 25 and 29 – in addition to Nembe Creek Trunkline, which for years have been plagued by leaks stemming largely from oil theft.
The Wall Street Journal quoted two people said to be close to the deal as saying that the transaction had been consummated.
The journal also quoted Taleveras as saying that it was among the preferred bidders for block OML 29 but added that the company declined to comment when asked whether a deal had been finalised. A Shell spokesman was also said to have declined to comment specifically on OML 29.
Under the on-going divestment of four Nigerian oil blocks by Shell, Midwestern Oil & Gas Plc/Mart Resources/Suntrust Oil, under the Erotron Consortium, won the bid for OML 18, having offered $1.2 billion for the oil block.
OML 29, the most prolific oil lease under the current asset sale, and the Nembe Creek Trunkline were won by Aiteo/Taleveras in conjunction with four other companies in the consortium, having submitted a $2.58 billion bid for the assets.
Pan Ocean Oil Corporation Nigeria Limited, operator of the NNPC/Pan Ocean Joint Venture, clinched OML 24 after submitting a bid of $900 million for the asset valued at between $500 million and $1 billion.
Lekoil, Crestar, Green Acres/CCC/Signet Petroleum, NDPR/SAPETRO and Essar submitted bids for OML 25. With a $500 million bid, Crestar won OML 25.
These successful bidders of the four oil blocks, which have paid 10 per cent of the bid price of the assets, have been given several deadlines to pay the balance but most of them have not met the deadlines.
The Shell-run entity that is selling the pipeline and oil blocks has a 30-per-cent ownership stake, along with Total SA of France, which owns 10 per cent and ENI SpA of Italy, with five per cent.
The Nigerian National Petroleum Corporation (NNPC) retains ownership of the remaining 55 per cent in the four assets.
Since 2010, Shell’s Nigeria subsidiary has sold $1.8 billion in Nigeria assets and isn’t alone in terms of reducing its onshore presence there. ConocoPhillips sold its entire Nigerian upstream business to local player Oando PLC in June, while Chevron Corp. is in the process of selling some assets in the country as well.
Source : energy mix report
