Petroleum Africa
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Friday, May 22, 2015
SacOil revealed that it has terminated its JV with Nigdel United Oil Company in Nigeria, effectively exiting OPL 233 and Nigeria. The exit is in line with the company’s strategy to focus on proven resources as a basis for growth.
Like a number of independent E&P firms, SacOil embarked on a process of balancing and rationalizing its portfolio of assets since the plunge in oil prices. SacOil said that the aim of the rationalization is to restructure its future capital requirements – focusing on cash generative assets and low risk exploration assets.
Under its deal with Nigdel, SacOil has the right to be refunded by Nigdel for all costs expensed to date on OPL 233. Consequently, SacOil has no future commitments and obligations associated with the appraisal of OPL 233. Further announcements relating to the details of the ccompany’s withdrawal from the asset will be made in due course.
Dr Thabo Kgogo, CEO of SacOil, commented, “The termination of the joint venture in respect of OPL 233 is in line with the strategy communicated to shareholders previously, improves the company’s financial position and will reduce future financial exposure emanating from such higher risk assets. With the expected return of capital from OPL 233 and OPL 281, combined with SacOil’s existing cash resources, the Company will be in a far stronger position to pursue its strategy of increasing production and focusing on cash generative assets.”
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