March 10, (THEWILL) – Savannah Energy Plc has finalized the acquisition of Sinopec International Petroleum Exploration and Production Company Nigeria Limited (SIPEC), strengthening its position in Nigeria’s energy sector.
The British independent energy firm had announced in March 2024 that it had signed share purchase agreements with Sinopec International Petroleum Exploration and Production Corporation, a subsidiary of China’s Sinopec Group, and Jagal Ventures Limited for the transaction.
SIPEC’s key asset is a 49% non-operated stake in the Stubb Creek oil and gas field, which is managed and 51% owned by Universal Energy Resources Limited, a Savannah affiliate.
Savannah confirmed on Monday that the total consideration for the acquisition was approximately $35.1 million, including around $19.5 million in cash available to SIPEC.
An additional $2 million in deferred payments will be made in eight quarterly installments. The transaction was funded through a $60 million Reserve-Based Lending debt facility arranged by The Standard Bank of South Africa Limited.
The deal boosts Savannah’s reserves and resources by about 30%, increasing from 151 MMboe to 197 MMboe. It also adds 227 Bscf of 2C gross gas resources at Stubb Creek, securing long-term feedstock gas for Accugas customers.
Following the acquisition, Savannah has outlined an 18-month expansion plan aimed at ramping up production at Stubb Creek from an average of 2,700 barrels of oil per day in 2024 to around 4,700 barrels per day.
Located in Akwa Ibom State, Stubb Creek is a producing oil field with significant undeveloped gas reserves. As of the end of 2024, it was estimated to hold 11 million barrels of 2P gross oil reserves and 515 Bscf of 2C gross gas resources.
Since commercial production began in 2015, the field has yielded 8.1 million barrels of oil. Crude is processed on-site before being transported to the Qua Iboe terminal via a 25-kilometer pipeline.
The field’s conversion to a 20-year petroleum mining lease, effective from December 1, 2023, aligns with Nigeria’s Petroleum Industry Act 2021.
Savannah’s CEO, Andrew Knott, described the acquisition as a major milestone for the company’s 2025 objectives.
Knott stated, “Our focus at Stubb Creek will now shift to implementing the expansion project, which is expected to increase production by nearly 75% over the next two years.
“I look forward to updating shareholders in the coming months on our progress, as well as on other key priorities.”
He also expressed appreciation to the Nigerian government for supporting the deal and welcomed SIPEC employees into the Savannah group.
Felix Ifijeh is a journalist with years of professional reporting experience. Known for his keen news sense, compelling storytelling and commitment to accurate, impactful reporting, he has built a reputation for turning leads into clear, engaging, and well-structured reports that resonate with readers. His work reflects deep newsroom experience and a commitment to accurate, impactful journalism.
