London-based Sirius Petroleum has entered a conditional agreement to purchase a 40 per cent participating interest in Nigeria’s Ke oil field and the surrounding Ke farmout area.
In order to fund the development of Ke, the company is preparing to place 313.9 million new shares, representing 30.73 per cent of the enlarged share capital to raise £15.67 million.
Ke is a small oil discovery located in swamp water in the southern part of the Niger Delta, approximately five kilometres from the Gulf of Guinea. The field was originally discovered in 1965 by Chevron, which retains a small royalty interest in any production income from the Ke farmout area.
Potentially recoverable oil volumes associated with the Ke field are expected to exceed 25 million barrels.
Nigeria is the most populous country in Africa and the eighth most populous country in the world. The country’s economy is one of the fastest growing in the world, with the International Monetary Fund projecting growth of seven per cent in 2010.
With the second largest oil reserves and the largest natural gas reserves in Africa, Nigeria is the tenth largest oil producer in the world, the third largest in Africa and the most prolific in sub-Saharan Africa. The country’s upstream oil industry is the single most important sector in the economy.
Most of Nigeria’s 36 billion barrels of proven oil reserves are located onshore, in over 250 fields of around 50 million barrels each, along the coast of the Niger Delta region.
The major foreign producers in Nigeria are Shell, Chevron, ExxonMobil, Total and Eni/Agip.
The proposed acquisition is conditional upon shareholder approval.
