Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has renewed Petroleum Mining Lease 52 (PML 52), containing the Agbami field, for a period of 20 years effective from November 24, 2024. The disclosure was made by Africa Oil as following its recent press release.

The Nigerian Upstream Petroleum Regulatory Commission has also given clearance for the amalgamation of Africa Oil Papa Corp., a wholly owned subsidiary of Africa Oil, and BTG Pactual Holding in exchange for the issuance of Common Shares in the Company to BTG Pactual Oil & Gas to effect the consolidation of 100% ownership of Prime Oil & Gas Coöperatief U.A. in Africa Oil.

NUPRC has confirmed that the Amalgamation does not amount to a change of control in the beneficial ownership of Prime’s Nigerian subsidiaries and Ministerial consent is not required for the Amalgamation, and therefore, the transaction may proceed as proposed.

PML 52 is operated by affiliates of Chevron and covers part (62.46%) of the producing Agbami field. This field was discovered by well Agbami-1 in 1998. The oil is light with a gravity of 45° to 47° API. The field is developed via sub-sea wells tied back to a dedicated floating Production Storage and Offtake (FPSO) vessel through steel catenary risers.

Production commenced in June 2008 and peak gross field production of 250,000 barrels of oil per day (bopd) was attained in 2009. At December 31, 2023, 30 producers, 5 gas injectors and 10 water injectors had been drilled. Field average oil production rate in 2023 was about 98,000 bopd. Cumulative oil production to December 31, 2023 was 1,089 million barrels for the field.

Prime Oil & Gas Coöperatief U.A. has a 8% ownership in PML 52. The operator is Chevron with a 32% interest. Famfa oil is the concessionaire on the production sharing agreement and holds a 60% interest in PML 52. Africa Oil has a 50% shareholding in Prime and on the completion of the Prime amalgamation transaction will have a 100% shareholding in Prime.

This is expected during first quarter 2024 and is subject to customary closing conditions, including competition clearance from the 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 S.à r.l. to implement the Amalgamation.

“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.

“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 first quarter 2025.” Africa Oil Chief Executive Officer, Dr Roger Tucker, commented.