The Nation Newspaper

Tag: OER

  • Shareholders approve Oando, OER buy-out offer

    Shareholders of Oando Energy Resources (OER) Inc- the Toronto Stock Exchange (TSX)-listed exploration and production subsidiary of Oando Plc, have approved the proposal by Oando Plc to buy out the outstanding minority shareholdings in the exploration and production subsidiary.

    OER announced at the weekend that at a special meeting on February 25, 2016 in Vancouver, British Columbia, a total of 550.46 million votes were cast by shareholders, representing 69.15 per cent of the total issued and outstanding common shares. A 100 per cent of the votes cast were voted in favour of the resolution.

    However, the plan of arrangement remains subject to the final approval of the Supreme Court of British Columbia and subject to satisfaction or waiver of various other conditions specified in OER’s management information circular dated January 19, 2016. The parties have agreed to extend the outside date to March 25, 2016.

    As part of the transaction, OER has notified the TSX and applied for the delisting of the common shares upon completion of the arrangement. In addition, in accordance with Section 720 of the TSX Company Manual, the company has applied to voluntarily delist the common share purchase warrants it issued from the facilities of the TSX upon completion of the arrangement. An exemption from the requirement for security holder approval of such delisting is available pursuant Section 604(f) of the TSX Company Manual because Oando Plc holds more than 90 per cent of the common shares.

    However, the completion of the transaction, including the delisting of the common shares and warrants from the facilities of the TSX, will be subject to, among other things, approval by the syndicate of lenders in OER’s $450 million senior secured facility.

    Oando had entered into a definitive agreement with OER to sell the outstanding minority shareholdings in the OER to another wholly-owned foreign-based subsidiary, Oando E&P Holdings Limited.

    Oando E&P Holdings Limited will also subsequently take over shares held by Oando Plc and other institutional shareholders in OER, making OER a wholly-owned subsidiary of the Oando E&P Holdings Limited, a private company incorporated under the laws of the Province of British Columbia as a wholly-owned subsidiary of Oando Plc.

    Earlier regulatory filing at the Nigerian Stock Exchange (NSE) indicated that Oando E & P Holdings Limited would acquire all the outstanding minority shares under a plan of arrangement for a cash consideration of $1.20 per share.

    Oando holds, either directly or indirectly, 746,107,838 of the common shares of OER, representing approximately 93.7 per cent of the issued and outstanding common shares. Pursuant to the plan of arrangement, Oando E & P Holdings Limited will acquire all of the common shares that are held either directly or indirectly by the institutional shareholders and Oando.

    In consideration for such transfer, Oando and the institutional shareholders shall receive such number of shares of Oando E & P Holdings Limited as reflects the number of their contributed common shares for the purposes of completing the transactions contemplated by the plan of arrangement. The referenced institutional shareholders are M1 Petroleum Ltd, West African Investment Ltd and Southern Star Shipping Company Inc.

    The consideration represents a 177.2 per cent premium to the 20-day volume weighted average price of OER’s common shares on the Toronto Stock Exchange for the period ending December 21, 2015, using the Bank of Canada US$ to CDN$ closing exchange rate of 1.3965 on December 21, 2015. The transaction provides total consideration to holders of minority shares of approximately US$13.7 million and implies an equity value for the company of approximately US$955.3 million.

  • Shareholders meet on Oando, OER buy-out offer

    Oando Energy Resources (OER)- the Toronto Stock Exchange (TSX)-listed exploration and production subsidiary of Oando Plc, has scheduled a shareholders’ meeting to vote on a proposal by Oando Plc to buy out the outstanding minority shareholdings in the exploration and production subsidiary.

    The meeting, according to a regulatory filing yesterday, is scheduled for February 25, 2016 in Vancouver, British Columbia. The board of OER has already recommended to shareholders to vote in favour of the special resolution authorizing the purchase of the minority shares.

    As part of the transaction, OER has notified the TSX and applied for the delisting of the common shares upon completion of the arrangement. In addition, in accordance with Section 720 of the TSX Company Manual, the company has applied to voluntarily delist the common share purchase warrants it issued from the facilities of the TSX upon completion of the arrangement. An exemption from the requirement for security holder approval of such delisting is available pursuant Section 604(f) of the TSX Company Manual because Oando Plc holds more than 90 per cent of the common shares.

    However, the completion of the transaction, including the delisting of the common shares and warrants from the facilities of the TSX, will be subject to, among other things, approval by the syndicate of lenders in OER’s $450 million senior secured facility.

    Oando had entered into a definitive agreement with OER to sell the outstanding minority shareholdings in the OER to another wholly-owned foreign-based subsidiary, Oando E&P Holdings Limited.

    Oando E&P Holdings Limited will also subsequently take over shares held by Oando Plc and other institutional shareholders in OER, making OER a wholly-owned subsidiary of the Oando E&P Holdings Limited, a private company incorporated under the laws of the Province of British Columbia as a wholly-owned subsidiary of Oando Plc.

    Earlier regulatory filing at the Nigerian Stock Exchange (NSE) indicated that Oando E & P Holdings Limited would acquire all the outstanding minority shares under a plan of arrangement for a cash consideration of $1.20 per share.

    Oando holds, either directly or indirectly, 746,107,838 of the common shares of OER, representing approximately 93.7 per cent of the issued and outstanding common shares. Pursuant to the plan of arrangement, Oando E & P Holdings Limited will acquire all of the common shares that are held either directly or indirectly by the institutional shareholders and Oando.

    In consideration for such transfer, Oando and the institutional shareholders shall receive such number of shares of Oando E & P Holdings Limited as reflects the number of their contributed common shares for the purposes of completing the transactions contemplated by the plan of arrangement. The referenced institutional shareholders are M1 Petroleum Ltd, West African Investment Ltd and Southern Star Shipping Company Inc.

    The consideration represents a 177.2 per cent premium to the 20-day volume weighted average price of OER’s common shares on the Toronto Stock Exchange for the period ending December 21, 2015, using the Bank of Canada US$ to CDN$ closing exchange rate of 1.3965 on December 21, 2015. The transaction provides total consideration to holders of minority shares of approximately US$13.7 million and implies an equity value for the company of approximately US$955.3 million.

  • Oando, OER in $98m debt-for-equity swap

    Oando Plc and Oando Energy Resources have struck a debt-for-equity deal that would reduce the outstanding indebtedness of the latter to the former by $98 million.

    A regulatory filing obtained at the weekend that OER, the upstream member of the Oando Group, has converted equity of principal and interest totaling $98 million under the outstanding $ 1.2 billion facility agreement dated 10 February, 2014 with Oando Plc into equities for Oando.

    With this, $41 million of principal remains outstanding under the Oando loan and an aggregate principal amount of approximately $292 million remains available to be drawn under the Oando loan.

    OER issued 68.14 million units to Oando Resources Limited, a subsidiary of Oando Plc, as repayment of amounts outstanding under the Oando loan at a conversion price of C$1.57 per unit. Each unit consists of one common share of the company and one-half of one warrant to purchase an additional common share at a price of CAD$ 2 per common share up until 30 July 2016, a 24 month period from which the company closed the acquisition of the Nigerian upstream oil and gas business of ConocoPhillips.

    The terms of the units, other than the denomination of the conversion price and exercise price in United States dollars, have the same terms as the units issued to third party investors and Oando Resources on previous tranches.

    Prior to the completion of the conversion, Oando Plc owned, and exercised control or direction over, 677.96 million common shares, representing approximately 93.2 per cent of the issued and outstanding common shares.

    As a result of the conversion, Oando Plc currently beneficially owns, or exercises control or direction over, 746.11 million common shares, representing approximately 93.8 per cent of the issued and outstanding common shares.

    Where Oando decides to fully exercise these new warrants and warrants previously issued to it on previous tranches of the loan, Oando would beneficially own, or exercise control or direction over, 1.07 billion common shares, representing approximately 95.6 per cent of the company’s issued and outstanding common shares. However, Oando is restricted from exercising any warrants that would result in its ownership of the company exceeding 94.6 per cent.

    Meanwhile, amounts owing under the Oando loan in the future may be converted into units at one or more prices to be determined in accordance with the pricing mechanism earlier determined and made public on February 10, 2014.

    It should be recalled that OER recently concluded the acquisition of ConocoPhillips’ Nigerian oil assets.

  • ConocoPhillips continues assets divestment in Africa

    Barely one week the American oil giant, Conoco Phillips, sealed deal with Oando Energy Resources (OER), an affiliate of Oando Plc, to ConocoPhillips to acquire its entire business interests in Nigeria for a total cash consideration of $1.79 billion plus customary adjustments the company has also agreed to sell its Algerian business unit to Indonesian state energy company PT Pertamina for $1.75 billion, plus customary adjustments, as part of its ongoing asset-disposition programme in Africa.

    ConocoPhillips Algeria Limited, according to Dow Jones Newswires, holds interests in three major onshore oil fields that averaged 11,000 barrels of oil equivalent per day through October. ConocoPhillips said the net carrying value of its Algerian assets was roughly $850 million as of October 31, 2012.

    The report said that ConocoPhillips expects to close the transaction by mid-2013 adding that the Houston-based energy company is in the midst of a three-year repositioning aimed at improving its balance sheet and focusing on more profitable, less risky unconventional fields in North America. ConocoPhillips has sold or plans to sell more than $7 billion in assets in 2012, including a $5 billion sale of its stake in Kazakhstan’s Kashagan field in the Caspian Sea announced last month. The company also spun off its refining arm earlier this year to Phillips 66.

    Oando, during the transaction said, in a statement by its spokesman of Oando, Mr Meka Olowola, that the transaction includes the intended purchase of Phillips Oil Company Nigeria Limited, which holds a 20 per cent non-operating interest in Oil Mining Leases (OMLs) 60, 61, 62, and 63 as well as related infrastructure and facilities in the Nigerian Agip Oil Company Limited (NAOC) Joint Venture.

    He also said the other partners are the Nigerian National Petroleum Corporation (NNPC) with a 60 per cent interest and NAOC (20 per cent and operator); and Phillips Brass Limited, which holds a 17 per cent shareholding interest in Brass Liquefied Natural Gas (LNG) Limited, which is developing the Brass LNG project, a Greenfield project to develop a two-train, 10 million ton per year liquefied natural gas facility in Bayelsa State, Nigeria. The other partners in this project are NNPC (49 per cent); Eni (17 per cent) and Total (17 per cent).

    In the offshore business arm of the deal, Oando said it would also acquire ConocoPhillip’s’s 95 percent interest in OML 131 in which Medal Oil owns five per cent; and ConocoPhillip’s 20 per cent non-operating interest in oil prospecting licence (OPL) 214.

    The other partners in OPL 214 are ExxonMobil (20 per cent and operator), Chevron (20 per cent), Svenska (20 per cent), Nigerian Petroleum Development Company (15 per cent) and Sasol (five per cent).

    Pursuant to the proposed acquisition, Oando will purchase all of the issued share capital of ConocoPhillips’ onshore and offshore affiliates in Nigeria. Upon closing, the effective date of the proposed acquisition will be today.

    According to Olowola, in connection with the proposed acquisition, Oando has retained The Petroleum and Renewable Energy Company Limited (Petrenel), OER’s independent reserves evaluator, to prepare a report on the reserves and resources of OMLs 60, 61, 62 and 63, which are onshore and OML 131 and OPL 214, which are offshore assets, proposed to be acquired under the proposed acquisition.

    Oando has got approval from Security and Exchange Commission (SEC) to raise N54.6 billion through right issue, which opened on December 28 and would close on February 6, 2013.