Savannah Energy Plc has completed the acquisition of Sinopec International Petroleum Exploration and Production Company Nigeria Limited, strengthening its foothold in Nigeria’s oil and gas sector.
According to a statement, the deal grants Savannah a 49 per cent non-operated stake in the Stubb Creek oil and gas field, which is 51 per cent owned and operated by Universal Energy Resources Limited, a Savannah affiliate company.
This acquisition marks a major milestone for Savannah, increasing its total reserves and resources base by 30 per cent from 151 million barrels of oil equivalent to 197 million barrels.
It added 227 billion standard cubic feet of 2C gross gas resources at the Stubb Creek Field, enhancing long-term gas feedstock for Accugas customers.
Savannah funded the transaction through a $60m Reserve-Based Lending debt facility arranged by The Standard Bank of South Africa Limited.
The total consideration paid at completion was approximately $35.1m, inclusive of $19.5m of SIPEC’s cash reserves, with an additional $2m in deferred cash consideration payable over eight quarterly instalments.
Following the acquisition, Savannah plans an ambitious 18-month expansion programme aimed at increasing gross production at Stubb Creek from 2.7 Kbopd in 2024 to around 4.7 Kbopd.
The statement mentioned that it is located in Akwa Ibom State. Stubb Creek Field is a significant oil-producing asset with untapped gas potential.
“As of year-end 2024, the field contained 11 MMstb of 2P gross oil reserves and 515 Bscf of 2C gross gas resources. Since commencing commercial oil production in 2015, the field has produced 8.1 MMstb as of December 31, 2024,” it added.
It further disclosed that crude oil from Stubb Creek is processed onsite and transported via a 25km pipeline to the Qua Iboe terminal. In December 2023, the field was granted a 20-year petroleum mining lease under Nigeria’s Petroleum Industry Act 2021.
The Chief Executive Officer of Savannah Energy, Andrew Knott, said, “We are delighted to complete the SIPEC Acquisition—one of our key business priorities for 2025. Our focus now is to advance the expansion project, which is expected to increase production by nearly 75 per cent over the next two years. We will keep our shareholders informed as we execute our growth strategy.”
Knott also expressed gratitude to the Nigerian government for its approval of the acquisition and welcomed SIPEC employees to the Savannah team.
“This strategic acquisition reinforces Savannah Energy’s commitment to expanding its operations in Nigeria, strengthening its position as a key player in the country’s oil and gas industry,” he noted.
SOURCE : PUNCH
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