9th Jun 2015 08:58
LONDON (Alliance News) - SacOil Holdings Ltd Tuesday said it has received USD10 million from Ecobank Nigeria after a performance bond related to an oil concession off the coast of Nigeria expired in early May, half of which will be treated as part repayment of an outstanding loan that its partner has.
The sum was cash collateral paid by SacOil and Energy Equity Resources Norway Ltd as part of their obligations to post a performance bond in April 2012 related to the OPL 233 offshore oil concession in the eastern Niger Delta basin off the coast of Nigeria. The performance bond expired on May 2.
Half of the USD10 million will be treated as part repayment of Energy Equity Resources Norway's outstanding loan related to OPL233.
"This represents another positive step in line with our strategy to ensure that SacOil has a strong cash position to fund its future growth ambitions by increasing production and focusing on cash generative assets," SacOil Chief Executive Thabo Kgogo said. "This refund removes the restriction on the cash balance associated with the cash collateral."
SacOil's USD25 million performance bond, which was issued by Ecobank, allowed it to help NIGDEL United Company Ltd fulfil its obligations under the profit sharing contract on OPL 233 after it agreed a farm-in deal with NIGDEL and Energy Equity Resources. The bond was paid to the Nigeria National Petroleum Corp.
SacOil has provided Energy Equity Resources' 50% share of the obligations under the bond, secured against EER's interest in the Concession. Energy Equity Resources was obliged to repay SacOil its 50% shares of the bond together with interest and costs associated with the cash collateral and the procurement of the bond before work started on the concession.
SacOil shares were up 11.1% at 1.25 pence In London Tuesday morning.
By Steve McGrath; [email protected]; @stevemcgrath1
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