Petrofac also has an option to invest a further $52 million
Petrofac spends $100 million on a 15 percent stake in Nigerian oil explorer, Seven Energy, fulfilling the British oil and gas company’s long-term ambitions to enter sub-Saharan Africa’s second-biggest economy.
Petrofac also has an option to invest a further $52 million, should project milestones be reached, bringing its interest up to 19.2 percent on a diluted basis, while other investors have agreed to inject an additional $50 million into Seven Energy.
“We see this as a mutually beneficial transaction. Seven Energy has a lot of experience in operating in Nigeria,” Petrofac’s CFO, Keith Roberts, told reporters in a conference call.
“We’ve been targeting for years to establish a much stronger (Nigerian) presence, and we believe that this transaction and the broader alliance, and the opportunity that gives us to both co-invest and co-develop with Seven will help us progress our ambitions to develop a significant presence in the country,” Mr. Roberts said.
Mr. Roberts noted that the company had “significant fire power”, with a billion dollars in cash on the balance sheet to fund any future acquisitions, but declined to say whether the company was looking at any other specific targets.
“Clearly, we need to be comfortable with the opportunities, the returns, and the associated risks. Let’s start with (this) before we think of anything else,” he said.
Petrofac will provide experienced personnel to help with the delivery of Seven Energy’s key existing projects, and will be represented on its board and management committees.
Shares in Petrofac were up 0.3 percent at 1,455 pence at 1313 GMT.
Source:http://234next.com/
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