Savannah in advanced discussions on acquisition of ExxonMobil assets in Chad, Cameroon
UK-based Savannah Energy is looking to acquire a package of upstream and midstream assets in Chad and Cameroon from ExxonMobil (US).
In a statement dated June 2, Savannah reported that it was in “advanced exclusive discussions” with the US super-major on a proposal for the acquisition of a 40% equity stake in the Doba oil project in Chad and an effective 40% interest in the Chad-Cameroon oil pipeline. These assets constitute ExxonMobil’s entire portfolio in the two countries, it noted.
The statement did not reveal how much Savannah had offered to pay for the stakes. But it did say that the parties’ discussions concerned a proposal that would be classified as a reverse takeover transaction under the rules of the AIM sub-market of the London Stock Exchange (LSE).
It also noted that both ExxonMobil and its partner Petronas (Malaysia) had decided last year to unload their stakes in the Doba project and the Chad-Cameroon link. According to previous reports, the total value of these assets has been estimated at around $1bn.
Savannah did not say when it might wrap up talks with ExxonMobil or sign an agreement. It did stress, though, that the proposal was still under discussion and that the parties had not yet reached an agreement.
The Doba oil project encompasses the Bolobo, Komé, Maikeri, Miandoum, Moundouli, Nya and Timbré fields in Chad’s Logone Oriental region. Together, these fields yielded 33,700 barrels per day (bpd) of oil on average in 2020. They are served by the Chad-Cameroon pipeline, which follows a 1,070-km route from south-western Chad to the Kome-Kribi floating storage and off-loading (FSO) vessel.
The pipeline was built by ExxonMobil under a public-private partnership agreement and began operating in 2003. It is operated by Cameroon Oil Transportation Co. (COTCO) and has a throughput capacity of 225,000 bpd, though it only carried about 129,200 bpd last year. The link is partly owned by Société des Hydrocarbures du Tchad (SHT), the national oil company (NOC) of Chad, which said last year that it wanted to unload its 21% stake.