Oando PLC secures $375 million Reserve Based Lending facility

Oando PLC (www.OandoPLC.com), the foremost indigenous energy solutions provider in Nigeria, with primary and secondary listings on both the Nigerian and Johannesburg Stock Exchanges, has today declared the successful increase of its Reserve Based Lending (RBL2) facility to $375 million. This refinancing, spearheaded by the African Export-Import Bank (Afreximbank) with assistance from Mercuria, extends the final maturity date of the facility to January 30, 2029.

In recent years, financing structures for the acquisition, development, and operation of oil and gas assets have frequently been organized as Reserve-Based Loans (RBLs). In this framework, the amount accessible to a borrower, in this case Oando, is directly linked to the size and value of their proven reserves, with Oando’s reserves amounting to 1.0Bnboe —known as the Borrowing Base.

This increase is a consequence of the Company‘s notable advancements in deleveraging, having significantly decreased the original $525 million RBL2 facility, which was established in 2019, to $100 million by the end of 2024. This proactive approach to debt management has facilitated successful refinancing.

Commenting on this strategic accomplishment, Mr. Wale Tinubu, Group Chief Executive of Oando PLC, stated: “We are delighted to have finalized the upsizing of our RBL2 facility, a strategic milestone that reinforces our commitment as Operator of the Oando-NEPL JV to maximizing the value of our expanded asset portfolio. Our Joint Venture possesses substantial reserves with the potential to yield over $11 billion in net cash flows to Oando throughout the assets’ lifespan. This working capital facility is essential for efficiently extracting and monetizing these resources. We are grateful for the ongoing partnership with Afreximbank and Mercuria, whose steadfast support highlights their alignment with our long-term objective of maximizing production, optimizing asset performance, and delivering sustainable value to all stakeholders.

This newly acquired capital will be strategically utilized to vigorously pursue essential growth initiatives, which include expedited drilling operations, vital infrastructure enhancements across its activities, and the adoption of advanced operational efficiencies throughout its portfolio.

These strategic investments directly align with the Company’s declared goal to substantially elevate its production capacity to 100,000 barrels of oil per day (bopd) and 1.5 billion cubic feet (Bcf) of gas per day by the conclusion of 2029.

This encouraging development follows Oando’s historic $783 million acquisition of the Nigerian Agip Oil Company (NAOC) from the Italian energy conglomerate, ENI, in August 2024. This transformative acquisition has significantly broadened Oando’s operational scope, integrating twenty-four currently producing fields, around forty identified exploration opportunities and leads, twelve essential production stations, an extensive network of approximately 1,490 km of pipelines, three crucial gas processing facilities, the strategic Brass River Oil Terminal, the notable Kwale-Okpai phases 1 & 2 power plants with a total nameplate capacity of 960MW, and a comprehensive array of associated infrastructure.

This successful refinancing highlights the trust of leading financial institutions in Oando’s strategic trajectory and its capability to leverage its expanded asset base to foster growth and value creation within the Nigerian energy sector and beyond.