Nigeria: Lekoil goes to court over 2015 offshore block buy

Nigeria-focused oil company Lekoil has applied to a court in Nigeria hoping it would expedite its 2015 acquisition of Afren’s stake in an offshore block in Nigeria.

Lekoil, which owns a 17.14 participating interest in the offshore block OPL 310 in December 2015 agreed to buy a 22,86 interest in OPL 310 from Afren which had been put in administration and its assets put up for sale.

The acquisition meant that Lekoil own a consolidated participating interest of 40 percent and an economic interest of 70 percent in OPL310 and would become the technical and financial partner of Optimum Petroleum Development Company (“Optimum”), the operator and local partner in OPL310 which retains a 60 percent participating interest.

According to Lekoil, an application for the transfer of the 22.86 percent interest was duly made by Afren Nigeria in January 2016.  This interest was also subject to Ministerial Consent from the Minister for Petroleum Resources.

In March 2016, Lekoil was notified by the Ministry of Petroleum Resources that the necessary due diligence exercise would be conducted that month. The due diligence exercise did not take place and has not been rescheduled by the Department of Petroleum Resources since then, Lekoil said on Tuesday, and the company has now decided to go to court to speed up the process and preserve its license rights.

“Despite progressing exploration and appraisal activities on OPL 310 as previously announced, LEKOIL has, to date, not received Ministerial Consent for its acquisition of the additional 22.86 per cent interest in OPL 310 or a satisfactory explanation of why such consent has not been forthcoming. As a result, the Company has taken the decision to apply to the Federal High Court for a declaration that is expected to expedite the consent process and preserve the unexpired tenure in the license. The company will provide updates to the market as appropriate,” Lekoil said.

The company is represented by Fidelis Oditah QC, SAN.

 

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