By Michael Eboh With Agency Report
LAGOS—ConocoPhilips has   completed the sale of its Nigerian upstream assets to Oando Energy Resources, a subsidiary of Oando Plc, for $1.5 billion, about N240 billion.

The company, in a statement to investors, also announced its final divestment from Brass Liquefied Natural Gas, LNG, saying it has transferred its 17 per cent stake in Brass LNG Limited, along with all of its related interests, to the remaining shareholders of Brass LNG Limited.

The company said the final price for its upstream assets sold to Oando was arrived at after customary adjustments.

Through this Transaction, Oando Energy Resources,OER will indirectly own all of the issued share capital of Phillips Oil Company Nigeria Limited, POCNL, Conoco Exploration and Production Nigeria Limited, CEPNL and Phillips Deepwater Exploration Nigeria Limited, PDENL.

According to ConocoPhilips, the sales price is inclusive of $550 million of deposits received, approximately $900 million received at closing, plus $33 million in deferred payments.

“The sales price less the cash in the business at closing, approximately $100 million, generated net proceeds of approximately $1.4 billion, after customary adjustments.

The company also stated that it expects to recognize an after-tax gain of approximately $1.1 billion for the sale.

It further stated that proceeds from the sale will be available for general corporate purposes, including investments in the company’s higher-margin, organic growth programs.

Commenting on the deal, Don Wallette, Executive Vice President, Commercial, Business Development and Corporate Planning, said, “We are pleased to complete these transactions with Oando Plc and the Brass LNG Limited shareholders.

“We appreciate the long and productive relationship we have had with the government of Nigeria and our partners.”

Speaking in the same vein, Chief Executive Officer, Oando  Energy Resources, OER,  Pade Durotoye, said the transaction was financed with an approximate 50/50 debt-equity ratio, adding that half of the deferred consideration of US$33 million is due six months after closing with the balance due 12 months after closing.

According to him, the transaction is immediately cash generative and will contribute significantly to the cashflows of the Company.

He said, “This transaction represents a transformational leap forward for our Company and is in keeping with our overall strategy to grow our portfolio of Nigerian-based assets by focusing on those opportunities that deliver high quality growth in reserves and production.

“Our management team is familiar with these assets and possesses the managerial experience and technical expertise necessary to unlock their value for our shareholders.”

Also commenting, Mr. Wale Tinubu, Chairman, OER said “we believe in the significant potential that the Nigerian oil and gas industry holds and are privileged to play a pivotal role in its consolidation, growth and development. We will continue to seek strategic opportunities that provide a platform for enhanced growth and value creation for our stakeholders.”