Africa Oil Corp. said Thursday it had completed its full takeover of Prime Oil & Gas Coöperatief UA, previously a 50-50 venture with BTG Pactual Oil & Gas S.a.r.l. (BTG Oil & Gas).
As part of the transaction, BTG Oil & Gas, registered in Luxembourg, has acquired a 35.5 percent of the enlarged Africa Oil.
All current production by Vancouver, Canada-based Africa Oil, which explores and develops oil and gas in Africa, comes from Prime. Netherlands-registered Prime holds stakes offshore Nigeria.
“There is compelling strategic rationale for the consolidation and we believe that the quality and materiality of the assets within our diversified portfolio, our newly combined balance sheet, the strength of the cash flow profile and an attractive double-digit dividend yield all help emphasize a superior investment proposition for investors”, Africa Oil president and chief executive Roger Tucker said in an online statement.
The company expects to raise its annual base dividend by about three times to about $0.15 per share or $100 million. The reorganization also comes with a commitment to distributing at least 50 percent excess free cash flow after base dividend distribution in the form of supplemental dividends or share buybacks.
Africa Oil named a new board, including three directors it had nominated: Michael Ebsary (independent), Pascal Nicodeme (non-independent) and Kimberley Wood (independent). BTG Oil & Gas also has three nominees appointed to the revamped board: Huw Jenkins (independent), Edwyn Neves (independent) and Ahonsi Unuigbe (independent).
Two more independent non-executive directors nominated by Africa Oil and approved by BTG Oil & Gas have been appointed: John Craig and Richard Norris.
Andrew Bartlett, Gary Guidry, Keith Hill and Erin Johnston stepped down from the board. And Aldo Perracini has taken over from Pascal Nicodeme as chief financial officer.
Africa Oil’s main assets now consist of an 8 percent stake in Petroleum Mining Lease (PML) 52 and Petroleum Prospecting License (PPL) 2003 and a 16 percent interest in PMLs 2, 3 and 4, as well as PPL 261. PML 52, which covers part of the producing Agbami field, and PPL 2003 are operated by Chevron Corp. PMLs 2, 3 and 4 and PPL 261, which contain the producing Akpo and Egina fields and the Preowei and Egina South discoveries, are operated by TotalEnergies SE.
“The enlarged Africa Oil is uniquely well-positioned to drive long-term value through its existing portfolio of world-class assets as well as by leveraging its strong balance sheet to consider strategically complementary acquisitions in our target markets”, said Africa Oil chair Huw Jenkins. “The Company has ambitious growth targets and the vision is to continue growing into a leading full-cycle E&P [exploration and production company], establishing it as a trusted and prominent industry partner”.
Source: By Jov Onsat from Rigzone.com