Seplat Petroleum Development Co. will buy Eland Oil & Gas Plc to become the country’s biggest independent exploration and production company. Eland’s main asset is the OML 40 license in the Niger Delta. With this buyout, Seplat’s production will peak to 64,000 barrels of oil a day, an increase of 30% from 2019 guidance.
Seplat will pay 166 pence a share for Eland and deal is valued at 382 million pounds (US$484 million). Eland’s directors will recommend that shareholders vote in favor of the deal, which represents a premium of 33% to the six-month average share price. Eland shares surged as much as 28%, a record gain, and traded at 164.8 pence recently when the news broke out of the buyout.
Nigeria’s independent producers have grown after snapping up oil leases from large international companies such as Royal Dutch Shell Plc. Sporadic attacks and sabotage forced the majors to scale down some operations. Aiteo, Seplat and other so-called E&Ps have helped drive output growth in t Nigeria, pushing production above limits imposed by the OPEC+ alliance.
