Nigeria’s Seplat takes over operation of oil mining leases from Chevron after one year of acquisition

Nigeria’s Seplat Petroleum Development Company Plc has finally taken over a 40 percent working interest in Oil Mining Lease (OML) 53 and effective 22.5 percent working interest in OML 55 that it acquired from Chevron Nigeria Limited (CNL) in February 2015.

The company listed on both the Nigeria Stock Exchange and London Stock Exchange had not been able to take over the licences due to a court ruling nullifying Chevron’s sale of its 40 percent interest in the oil mining leases to the Seplat Consortium of Nigeria (including includes the Seplat Petroleum Development Company, Amni International Petroleum Development Company Limited and Belema Oil Producing Limited). The court held that no sale could take place until Brittania-U Nigeria Limited’s lawsuit against Chevron is resolved.

Brittania-U filed a suit at a federal court in Nigeria in December 2013, accusing Chevron Nigeria Limited, Chevron USA and its partners of breach of bid arrangement in the sale of the oil mining leases. It asked that Chevron be compelled to finalize the sale or pay $11 billion in damages. Brittania-U officials later filed a suit in Houston alleging that Chevron backed out of the deal after Amni, Belema and others raised questions about the company’s finances.

However, after years of legal battle, the Supreme Court ruled in favour of Chevron and Seplat, which allows CNL to conclude the full transfer and operatorship of the Assets to Seplat.

“We are naturally pleased with today’s ruling, not least because it means we are free to deploy our proven operating expertise and realise the significant reserve, production and value potential these blocks hold,” said Austin Avuru, Seplat’s Chief Executive Officer.

“To give an idea of scale, we estimate these blocks to hold recoverable volumes of around 200 million barrels of oil equivalent net to Seplat, a material volume by any standard and one which has now been unlocked for us,” Avuru added.

Last week, the company reported a full year 2015 working interest production of 43,372 boepd and expected revenue of $550 million to $600 million. The new acquisition is expected to further boost the company’s position as a leading Nigerian indigenous oil and gas company listed