Shell, GTB Grant $270m Oil-backed Loan to Amni International

Ejiofor Alike with agency report

Barely two months after Shoreline Group sealed a $530 million finance deal with Vitol Group and local lenders, including Union Bank Plc, Ecobank Transnational Inc., Fidelity Bank Plc and FCMB Group Plc, another Nigerian independent producer, Amni International, has sealed a $270 million loan deal with Guaranty Trust Bank Plc and a subsidiary of Royal Dutch Shell Plc, Shell Western Supply and Trading Plc.

The terms of loan will give Shell Western Supply and Trading Plc sole access to the 16,000 barrels per day (bpd) of oil the company pumps in two fields off Nigeria’s oil-rich Delta region.

Reuters reported that production at offshore fields, including Amni’s Ima and Okoro/Setu, is difficult to maintain, but Amni said the loan would allow them to further develop the fields. The company also has an offshore concession in Ghana.

“We are excited to work with GTBank and Shell as commercial and financial partners to enable the realisation of Amni’s ambitious plans for growth,” Amni’s Chief Executive Tunde Afolabi said in the statement.

Amni has two producing offshore operations in Nigeria and an interest in a newly awarded block in Ghana.
The company also owns its own infrastructure including platforms, pipelines and offshore terminals
The company’s Oil Mining Lease (OML) 112 (formerly Oil Prospecting Lease (OPL) 469 is located offshore in the eastern part of the Niger Delta.

The block was awarded to Amni on a sole risk basis in 1993 and converted to an OML in 1999. OML 112 covers an area of approximately 437 square kilometres.

OML 117 (formerly OPL 237) is similarly located and was awarded to Amni in 1994 and converted to an OML in 1999. OML 112 covers an area of approximately 50 km2.

The Okoro and Setu East fields are located in OML 112, with the two fields separated by 6.5km in shallow water. Okoro field was appraised in 2006 and production commenced in 2008.
In Ghana, Amni’s Central Tano Block is in the Deepwater Tano Basin, offshore western Ghana.
It is bounded by the Jubilee Field to the east and the TEN Fields to the west.

Multinational oil giants and trading houses often extend financing to smaller oil and gas producers in deals that allow the financier preferential access to physical cargoes and give the recipient companies the cash they can use to develop and maintain their assets.

Earlier this year, Nigeria’s Shoreline agreed a similar type of deal worth $530 million with major oil trader Vitol, backed by several banks, including Union Bank Plc, Ecobank Transnational Inc., Fidelity Bank Plc and FCMB Group Plc.

Shoreline seeks to boost production to between 80,000 and 100,000 barrels a day this year, according to the Chief Executive Officer, Kola Karim said.

The company currently pumps about 55,000 barrels a day.
“The funds will be used to refinance existing debt and provide us with working capital to expand production. As part of the funding arrangements, Shoreline will work with Vitol to market the crude, and in the development of its export logistics capabilities,” Karim reportedly said.