Decklar Resources has announced it has entered into a non-binding letter of intent to purchase all of the issued and outstanding shares of Wesfield Exploration and Production. Westfield E&P is the Nigerian entity that holds a Risk Finance and Technical Services Agreement (RFTSA) with Erebiina Energy Resources, the recent winner of the Emohua Marginal Field (OML 22) during Nigeria’s 2020/2021 Marginal Fields Bid Round. Erebiina is operating the Emohua field with a 60% interest.
“Emohua has a considerable infrastructure advantage with existing oil and gas export pipelines in close proximity. This will allow Decklar to use an Early Production Facility (EPF) after the Emohua-1 re-entry well as part of a fast-track development plan to realize near-term cash flow,” the company said in a statement.
Decklar has been increasing its footprint across Nigerian marginal fields over the past two years. In 2019, its Nigerian subsidiary Decklar Petroleum entered into a Risk Service Agreement (RSA) with Millenium Oil and Gas Co. to provide technical, financial and operational support needed to develop the Oza Marginal Field on OML 11. Drilling is ongoing there, with the Oza-1 well expected to be put back on production before the end of the year.
In July 2021, Decklar continued its acquisition spree by completing a Share Purchase Agreement (SPA) to acquire Purion Energy, the Nigerian entity that holds a RFTSA with Prime Exploration & Production in respect of the Asaramatoru Marginal Field (OML 11).
Decklar has so far focused on drill-ready assets located in close proximity to existing and operational oil and gas evacuation infrastructure.
“The M&A deals space in Nigeria is very hot at the moment especially onshore and in shallow waters,” said Mickael Vogel, Head of Research at Hawilti. “Investors are especially looking at the market’s brownfield opportunities which offer tremendous upside potential and the ability to cash in very quickly. While everyone is focusing on transactions involving IOCs’ divestments, other juniors and independents are quickly moving to get a foothold over smaller assets that can be put on production within 12 months or less.”
Details on the development of the Oza and Asaramatoru Marginal Fields are available in the “Projects” section within your Hawilti+ research terminal.