London, UK | – A leading Nigerian indigenous oil and gas exploration and development company, Seplat Petroleum Development Co. plc has resumed talks for a potential acquisition in Nigeria’s Niger Delta, agreeing with the sellers to set aside a smaller pool of funds ahead of a possible deal amid the sharp recent fall in oil prices.
The U.K. and Nigeria-listed Company, co-founded by Nigerian financier A.B.C Orjiakor, is part of a consortium seeking to buy the asset from oil and gas majors operating in the region, a person familiar with the matter said.
The company’s stock price surged on the news, rising 7.4% in London to 116 pence, giving Seplat a market capitalization of GBP642 million or $987 million.
Seplat, whose shareholders include MPI, spun off from France’s Etablissments Maurel et Prom SA, France’s Etablissments Maurel et Prom SA, said it can’t disclose the name of the asset, the seller, or the consortium members due to confidentiality clauses signed as part of the deal negotiations.
Some of the major companies operating in the region include Royal Dutch Shell plc, Chevron Corp., ConocoPhillips, Exxon Mobil Corp., Total S.A., and ENI S.p.A.
Seplat said it has now set aside $74 million, made up of a returnable deposit with the vendors and money deposited in an escrow account, compared with $453 million set aside last year as its share of the consortium’s pre-deal commitments. The company said it now has access to $368 million in cash that was previously held in an escrow account.